Govt to start buying grain in Aug-Sept
MOSCOW. July 4 (Interfax) - Russia may start to intervene on its grain market in August-September, the Agriculture Ministry said. Earlier the ministry had said that is when intervention would begin but then in June Deputy Agriculture Minister Ilya Shestakov announced that the State Grain Fund would start buying grain in October-November.
"Government procurement intervention for the 2013 grain harvest, one of the aims of which is to ensure sufficient yield for agriculture producers, is set to begin in August-September, based on the gross harvest in the Russian regions," the ministry said.
Intervention for the 2013 grain harvest was discussed at a meeting of the ministry's market regulation department.
As it prepares for intervention the department plans to select around 400 organizations in the regions with overall grain storage capacity of 10 million tonnes. The selection is to take place over seven tours.
Public electronic auctions were held on July 2 for the first three tours in the Southern, North-Caucasus, Central and Volga districts.
Government contracts for storage have been signed with 41 winners in the first tour of the auction. These companies can store up to 1.25 million tonnes of grain.
Contracts for storage of up to 2.75 million tonnes with 106 winning companies in the second and third tours.
The fourth tour is to take place on July 18.
The main selection criteria remains unchanged - optimum location for the convenience of agriculture producers and competitive prices to reduce government spending, the ministry said. The price level for intervention on the wheat, rye, barley and corn markets was determined by a ministry order of March 30 2013.
Earlier Shestakov said there may not be any need for intervention "if the market situation is good." He said that if there was intervention it would not exceed 5 million tonnes of grain.
The Agriculture Ministry predicts a gross grain harvest of 95 million tonnes in 2013.