13 Apr 2010 17:30

Kazakhstan doubles transportation subsidy on grain exports through Russia

ASTANA. April 13 (Interfax) - Kazakhstan, has doubled subsidies for grain transportation through Russia to $40 per tonne. It is also introducing subsidies on grain exports to China and transportation through China at $40 per tonne.

The head of National rail company Kazakhstan Temir Zholy, Yermek Kizatov, said at a press conference in Astana on Tuesday that the state commission on economic modernization had approved the grain subsidy.

"Recently the state commission for modernization made the decision to compensate transportation of grain exports to and through China at $40," he said.

An analogous subsidy will be applied for exports to Russia.

The state has allocated 5 billion tenge to compensate for transportation of grain through Kazakhstan.

It was reported earlier that the Kazakh Agriculture Ministry is subsidizing grain transportation in Russia at $20 per tonne.

The Agriculture Ministry lobbied for a doubling of the subsidy. "We have submitted a proposal to the government on doubling the subsidy through Russia and including another export direction: China and Southeast Asia," Deputy Agriculture Minister Marat Orazayev said previously.

The exports are forecast to total 400,000 tonnes through Russia and 200,000 tonnes to China and Southeast Asia in 2010.

Kazakhstan harvested 22.7 million tonnes of grain (bunker weight) last year or 20 million tonnes after processing.

Kazakhstan has the potential to export an estimated 9 million-10 million tonnes of grain in the current marketing year.

The official exchange rate on April 13 was 146.77 tenge/$1.