Grain producers insist on decreasing railway fares

Participants of the Russian grain market will make a proposal to reducerailway fares by 40-60%, depending on the distance between the respectivegrain-producing region and ports of Baltic Countries and Ukraine, at aRussian government meeting on September 19. Alexander Yukish, chairman ofthe Grain Union of Russia, reported at today's news conference that thisproposal was intended to facilitate grain exports. Not long ago theRailroad Ministry suggested a decrease in the fare for graintransportation, envisaging the use of a 0.8 coefficient for the standardfare. Additionally, grain market participants intend to suggest that thegovernment should guarantee the return of the VAT paid by grain exporterswithin one month. At present, the term of such return is three months.Yukish pointed out that purchasing interventions on the grain market wouldbecome a method of collective support for the minimum guaranteed prices foragricultural producers during this season. However, he underlined that theexperience of 2001 had to be taken into account. Thus, access to the grainexchange for market participants should be simplified, and the mechanismfor cooperation between the contractors should be improved. According to Andrei Sizov, director of the SovEkon analytical center, therespective interventions involved just 4-5 companies last year, and it wasa mistake to limit the interventions to a specified period of time. In hisview, the new interventions were to last for the entire grain year, and itis necessary "to buy excessive grain on the market in portions."Russian Agriculture Minister Alexei Gordeyev and Deputy Minister AnatolyMikhalyov will make reports at the meeting of the Russian government onSeptember 19. .

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