Export restrictions: why Russia needs to quickly remove quotas on grain sales


Having lost on the export of oil and gas, Russia has a chance to recoup on the food market. The Bloomberg agency believes that our country can come out on top in the world in terms of grain exports. However, unlike American analysts, domestic farmers themselves are not so optimistic.


To its credit, Russian agriculture has made a big leap forward in recent decades. Even the old Soviet grain harvest record was broken. Everything that is collected in excess of the domestic consumption rate is exported to more than 100 countries around the world. The main competitors of Russia are the United States, Australia, Canada and the European Union. However, there are important nuances.

The United States exports its grain primarily to the Central and South American market. The main rival of domestic farmers is the European Union, with which they traditionally fight for sales to Africa and the Middle East. It so happened that this year, due to the drought followed by floods, European farmers will miss a significant part of their harvest, the share of which may go to the Russians. The US Department of Agriculture has calculated that the increase in grain exports from the Russian Federation could amount to a very impressive 10%.

Despite such optimistic forecasts, Russian farmers grumble with displeasure. Their main complaint is the quota mechanism that was applied by the authorities this year against the backdrop of the coronavirus pandemic. The volume of grain that was allowed to be exported is limited to 7 million tons, and it has long been selected. Quotas are not entirely unambiguous.

On the one hand, this measure can be considered correct, looking at the example of other countries. With the arrival of COVID-19 and complete uncertainty about how long the global quarantine will last, many states began to restrict food exports, saving it for a rainy day, for example, Vietnam, Romania, even Ukraine announced such plans. Russia also introduced quotas for supplies to the EAEU and, in general, this was the right decision, since food security is a priority.

On the other hand, the situation with the coronavirus is gradually returning to normal, there is no previous panic, even the first vaccine has appeared. Cereal prices on the world market are growing, which gives hope to the agricultural sector to earn extra money. However, quotas hinder this, which can lead to overstocking of the domestic market. Some experts warn that farmers may simply stop increasing planting volumes and reduce investment in renovation. equipment and the expansion of port terminals, as restrictions would make it unprofitable for their products to enter foreign markets.

The question is extremely controversial. Participants themselves consider the quota mechanism "clumsy" due to its imperfection and lack of flexibility. The Russian Grain Union warns that some foreign buyers are beginning to refuse deliveries from our country due to a delay in delivery. For example, Bangladesh has recently preferred Ukrainian grain. Probably, officials should listen to the farmers and try to take into account not only national, but also their commercial interests.
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7 comments
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  1. Vladimir Tuzakov (Vladimir Tuzakov) 25 August 2020 12: 33
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    Comment. To say something intelligible about the grain market, you need to understand it thoroughly and for more than one year. Our recommendations are how a city dweller can teach an agronomist-academician to cultivate land ...
  2. Tektor Offline
    Tektor (Tektor) 25 August 2020 12: 49
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    The quota system needs to be improved in such a way that every grain producer has the opportunity to export part of the grain. Exactly - for everyone! But only a part.
    1. Oyo Sarkazmi Offline
      Oyo Sarkazmi (Oyo Sarkazmi) 25 August 2020 13: 33
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      Quote: Tektor
      each grain producer had the opportunity to export part of the grain.

      There is a quota exchange for this. You buy out a quota and export it.
      Selling quotas is disciplined. You have to think about whether you will recover the money spent, and you will think about a decent price.
  3. Oyo Sarkazmi Offline
    Oyo Sarkazmi (Oyo Sarkazmi) 25 August 2020 13: 30
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    The author is not aware that the export restriction has been lifted since July 1?
    And there will always be export quotas. So that in the lust for green cut paper everything is not poured abroad for a song.
  4. boriz Offline
    boriz (boriz) 25 August 2020 16: 24
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    Cereal prices on the world market are growing, which gives hope to the agricultural sector to earn extra money.

    It is necessary to buy at a normal price from the manufacturer and put it in the State Reserve. And dealers will earn extra money on exports. The manufacturer, as always, will get crumbs.
  5. Boris Nikolayevich (Boris Nikolaevich) 25 August 2020 17: 13
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    Sergei Marzhetskiy asks the question in the title:

    ... why Russia needs to quickly remove quotas on grain sales.

    Having lost on the export of oil and gas, Russia has a chance to recoup on the food market. The Bloomberg agency believes that our country can come out on top in the world in terms of grain exports ...
    Answer. In order, in addition to everything, to kill their population, leaving it without food, without bread, without meat (since there will be nothing to feed the animals) and so on. The bourgeoisie need to reduce the population of the country in order to spend less on it, and therefore more to replenish their bottomless pockets! Sergey Marzhetsky is either complete, which is unlikely, or an outright enemy of the people along with the bourgeoisie!
  6. marciz Offline
    marciz (Stas) 31 August 2020 03: 54
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    Even the Soviet record was broken !!!! ??? This is despite the fact that where orchards and fields, tomatoes, cucumbers and other vegetables grew during the USSR, and were not imported from the long-hostile Turkey !!! Now these lands have become vacant, just as jobs have been lost, but they have increased in Turkey! ((What record are you talking about, Jewish puppets, huh! ???