The Russian government will purchase 9.6 million tons of grain at a total cost of RUR 31 billion.

The Minister of Agriculture of Russia Yelena Skrynnik noted that the government has completed its interventions in grain production for the 2008 harvest.

The money paid by the government supported farmers, stabilized prices, and created a strong economic foundation for the sowing and harvesting operations, according to Ms. Skrynnik.

The Ministry of Agriculture has been taking measures needed for preparing for new grain interventions. Over 470 grain storage facilities were designated for use by the state.

In 2008, Russia’s agricultural exports were 19 million tons. Since the end of the previous agricultural season, the country exported only 15 million tons of grain.

Russian grain exporters have not entered the European markets yet. Part of the reason for the lack of success is the ongoing economic recession.

Earlier in the year, Ms. Skrynnik indicated that the Russian government would appropriate RUR 20 billion for grain purchases and interventions in the current year. The government has already established the prices for the grain of the new harvest.

The Ministry of Agriculture also made a decision to unload vast grain storage facilities in the southern and central regions of Russia to make them available for interventions in the future. Every day the Ministry allocates and assigns 20-30 grain storage facilities for use in the interventions.

Ms. Skrynnik reported that a number of issues came up with grain storage allocation for the current intervention. Analysts predict that in the current agricultural year that stretches from July 1, 2008 to July 1, 2009 the grain harvest in Russia will be from 85 to 90 million tons.

In the previous year, grain harvest stood at 108.1 million tons, a number that was 32.6 percent greater than what was received in 2007. The harvest figure for 2007 was 81.8 million tons.

During the current year, the balance of harvested grain that would be carried over from past years would be almost 200 million tons. Governmental grain reserves in that case will be around 105 – 110 million tons.

President of the Russian Grain Union Arkady Zlochevsky forecasted that Russia would harvest at least 80 million tons of grain in 2009. “Even under the worst scenario and bad weather, the minimum grain crop will amount to 80 million tons, including all possible losses,” he said. In his opinion, favorable weather conditions will make it possible to harvest 100 million tons.

Analysts are sure that there will be such a large grain harvest since this year’s land allocations for winter crops have been increased, Zlochevsky said, adding that winter grain yield is always higher than that of spring crops.

The area of land used for the cultivation of winter crops has reached 17.1 million hectares, which is 240 000 hectares more than what it was in 2008. The condition of the land is also better than in 2008.

The issue of storing grains during the 2009-2010 agricultural year will be very difficult to resolve because storage facilities are already filled to almost their maximum capacity as a result of the record harvest of 2008. Investment in new infrastructure is urgently needed.