Russia said yesterday it was declaring a federal emergency in 10 regions because of damage to crops from May frosts, a measure that will help farmers with extra funds but which officials said should not derail export obligations.
The move came as no surprise after Agriculture Minister Oksana Lut said earlier this week that she hoped it would be introduced, paving the way for insurance claims by farmers.
Deputy Agriculture Minister Andrei Razin said yesterday that the impact of weather problems on farm output would be minimised and that Moscow would fulfil all of its export commitments, the state TASS news agency reported.
“As of today, we have already replanted almost 800,000 hectares,” he said. “All our obligations from the point of view of both domestic consumption and external export obligations will definitely be fulfilled.”
The sharp May frosts in Russia’s breadbasket regions have caused agricultural consultancies IKAR and Sovecon to downgrade their crop forecasts for this year’s wheat crop, however.
IKAR has cut its forecast to 81.5 million tonnes, a drop of 12 per cent since mid-March. Last year’s harvest was around 93m tonnes.
Speaking this week before the emergency was introduced, IKAR head Dmitry Rylko said it was “a question of speeding up the procedure for farmers to receive compensation, as well as knocking out additional money for them”.
Andrey Sizov of the Sovecon consultancy said rapidly deteriorating prospects for the crop, combined with rising domestic prices, meant the risk of additional restrictions on grain exports had, however, increased.
“I don’t think the Ministry of Agriculture itself wants such restrictions,” he added. Russia is the world’s biggest wheat exporter.
Sovecon this week cut its wheat crop forecast to 80.7m tonnes. Back in March, it was projecting a crop of 94m tonnes.
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