Russian Agriculture Ministry plans to stimulate wheat purchases on domestic market

SAMARA. Sept 22 (Interfax) - Federal authorities are trying to stimulate the growth of domestic wheat consumption to stabilize the Russian market, which is under pressure from export difficulties; one of the measures being discussed is preferential loans for the purchase of grain for millers and livestock breeders, the newspaper Kommersant reported.

According to the newspaper, the Samara region's Agriculture and Food Ministry asked regional agricultural enterprises to provide information on the possible amount of grain purchases provided they are granted preferential loans. The work is being carried out at the request of the Russian Agriculture Ministry and aims to offset the risks of forming a grain surplus through domestic consumption. The potential level of purchases and lending is calculated on the basis that the size of the markup will be up to 10%.

The Samara region is not the only region considering the possibility of stimulating domestic demand for grain. On September 21, the Novosibirsk region's deputy agriculture minister, Denis Gamza, reported on the Russian Agriculture Ministry's instructions to the regions to provide a list of agricultural producers and millers in need of a preferential loan for purchasing wheat, Kommersant said, citing the portal infopro54.ru. It is assumed that local processors will be able to receive preferential loans at a rate of 9% per annum for the purchase of grain.

The issue of increasing grain purchases within the country is being worked on, and the parameters of possible preferential lending will be determined taking into account the information collected in the regions, the Russian Agriculture Ministry told Kommersant.

To maintain the profitability of agricultural producers, the government has also allocated 10 billion rubles to subsidize railway tariffs for transporting agricultural cargo, the Agriculture Ministry said. The issue of providing preferential short-term loans and leasing services for crop-growing enterprises is currently being worked out. State procurement interventions in Russia's southern regions are also being prepared - in this way, it is planned that up to 3 million tonnes of grain will be purchased.