Russia: Government partially lifts grain export ban
January 11, 2011
In November, exports added 14.6% over the same month last year to USD 35.3 billion. The reading marked a slight moderation compared to the 14.9% expansion registered in October. Despite the recovery, exports are still far from pre-crisis levels, with the 3-month sum in exports standing at USD 104.7 billion in November, below the peak of USD 136.8 billion reached in August 2008 but nonetheless above the USD 57.3 billion through of March 2009. Meanwhile, imports grew 26.3% year-on-year in November, which was slightly down from the 27.0% increase recorded in October. As imports slowed more than exports, the trade surplus widened from USD 10.5 billion in October to USD 10.9 billion in November. Going forward, exports are likely to pick up. On 11 January, the government decided to lift part of the ban on grain exports. The ban was implemented last August to hold corn price increases on the domestic market in check after a severe summer drought had destroyed large parts of the harvest. The government will allow exports of flour, following complaints from millers that they were losing clients abroad. However, the ban remains in place for other grains, like wheat, barley, rye and corn. Russia is one of the world's largest grain exporters and the ban, which will remain in place until the end of June, will dent export growth. Meanwhile, the price for Ural oil, Russia's key export commodity, continued to rise. In the last week of December, the price for Ural oil reached USD 90.94 per barrel, which was 26.17% higher than a year ago, and marked the highest price per barrel in more than two years.
Author: Armando Ciccarelli, Head of Data Solutions