Loosely on grain interventions




One would think Russian market should be glad that the governmental support makes the agriculture one of the several growing industries of Russian economics.

However, the development provides various problems: great grain harvest, seasonal factor cause the fall of purchasing prices. The decrease of prices provides small effect on consumers, but damages incomes of agrarians.

This brings up the reasonable question: how should the markets harmonize all interests? Elena Skrynnik, the Minister of Agriculture of the Russian Federation, told us about several new approaches for solving the task.

- Elena Borisovna, the general growth of agricultural production conceal the great differences between development of various regions. One regions show the tremendous growth of production rates, but neighbouring regions - the fall. Does the misbalance influence on difficulties with selling of agricultural products, which plant growers and animal breeder report about?

Ultimately, we should reach not elemental or natural growth of production rates, we should make regions to independently produce required agricultural raw material and foodstuffs, knowing the definite directions of the further trading operations with the agricultural products.

The approach is based on simple economic logic. If You produce grains more than You can consume, then You should think about development of the domestic consumption or exports. Otherwise, the governmental support of the production and co-financing of the regions have inadequate character.

Why should we support agricultural producers? Should they grow feed grains and we should purchase such grains at the state budget expenses? As a reminder, last year, Russia spent over 38 bln RUR for providing of purchasing interventions. At the same time, to date, grain prices on the market are lower compared to the purchasing prices. That is why, we have to either sell grains at a loss, or continue storing the grains, that means additional losses only.

- What is the meaning of so-called "passports of regions", You used to tell about previously?

- The creation of passports of subjects of the Russian Federation at fulfillment of indices of the governmental program is the second most important direction of the state regulation of the market. The federal center and regions are equally responsible for realization of the aims of the governmental program. That is why, they should summarize own financial resources for development of such aims, for example summarizing of resources for beef production both from the state budget and the budget of the subject of the Federation. The support should also show what production volumes the oblast, krai or republic reach due to such support. In such case only, we will understand how much the government spends for every additional kilogram of meet. Or milk. Alternatively, any other variety of product, which is produced under governmental support. Moreover, heads of regions will structure their approaches to supporting of various directions in agricultural production sphere.

-Could it happen that the new approach will turn into just a mount of new certificates, staying on tables of Your department without any development?

- We already introduce the new informational and analytical system, similar to the system Moscow uses for controlling of foodstuff purchases, and realization of the system. We should know information about every region of the country, volumes of production and consumption, trading operations with neighboring regions, exports and imports. Due to the information, we will avoid overproduction of one or another variety of foodstuff in one regions, and fight deficit of food production in other regions. As a result, we will reach the growth of effectiveness of the governmental support of agriculture.

On the current basis, we will complete our important plan of import substitution on term and reasonable prices.

- Elena Borisovna, agrarians were waiting for the beginning of grain purchasing interventions in August or September. When the interventions will start?

- I would like to mark that the main task of, grain interventions is not the total purchasing of all produced grains at high prices, but point removal of grain surpluses from the market. We purchase grains from agricultural commodity producers at market prices through the institute of exchange trading. The intervention is the market mechanism of limited actions.

To date, the Ministry is completely ready for providing of interventions, and in the nearest future we will declare about the beginning of the process.

- To date, grain prices on the market are lower compared to the declared intervention price. Will Your Ministry change the price index?

- We declared the price at the end of March, as we had to do according to the law about development of agriculture. The price is the same as in the previous year. But we realize the purchasing operations on the basis of offers of the least price. In other words, the purchasing is the trading for recession.

- Many experts offer to support export trading in order to stabilize prices on the domestic market in the current year. What is the position of the Ministry of Agriculture?

- In the current moment, I can answer only one thing: we examine the issue.