FACTBOX-Russia’s measures to stabilise domestic food prices

FACTBOX-Russia’s measures to stabilise domestic food prices

March 27 (Reuters) – Russia plans to impose high export
taxes on sunflower oil and sunflower seeds until September 2022
in its battle to tame the country’s rising food inflation, its
ministries said on Saturday.

Russia’s annual inflation had spiked to 5.8% as of mid-March
and is only expected to slow to its central bank’s 4% target in
the first half of 2022, later than previously expected.

Below is a list of the measures, which were initially
approved in December and then toughened in several rounds. New
measures are marked with *:

GRAINS

– Russia has set a grain export quota for overseas shipments
of wheat, rye, barley and corn (maize) of 17.5 million tonnes
for Feb 15 to June 30.

– Russia initially introduced a wheat export tax of 25 euros
($29.5) within that quota from Feb. 15 and then raised it to 50
euros from March 1. If exports exceed the quota, the tax for
wheat will be raised to 50% of the customs price, but no less
than 100 euros per tonne.

– Russia launched a barley and corn export tax of 10 euros
per tonne and 25 euros per tonne respectively from March 15. The
exporting duty for rye within the quota is at zero.

– Starting from June 2, Moscow will launch a permanent
formula-based export tax for wheat, barley and corn.

The formula for wheat will be set at 70% of the difference
between a base price of wheat per tonne and $200.

The base price will be determined by the agriculture
ministry on a weekly basis, based on price indicators traders
would report to it.

The formula for barley and corn will be similar to wheat,
but will use $185 instead of $200 for calculations.

SUGAR, SUNFLOWER OIL, OTHER PRODUCTS

* – Russia’s export duty for sunflower seeds is set at 30%,
but not less than 165 euro/tonne, between Jan. 9 and June 30.
The government plans to raise it to 50%, but not less than
$320/tonne, for the period between July 1, 2021 and Sept. 1,
2022.

For the same period, a tax on rapeseed exports is planned at
30%, but not less than 165 euro/tonne.

* – Starting from September, an export tax on sunflower oil
is planned for one year. Officials plan to set it at 70% of the
difference between its indicative price per tonne, which will be
determined based on Reuters’ data, and $1,000.

* – The government plans to eliminate taxes on imports of up
to 350,000 tonnes of white sugar between May 15 and Aug. 31.

– The government approved its right to regulate domestic
prices for 24 “socially important products” – such as bread and
other food staples – for 90 days if their two-month price growth
exceeds 10%, excluding seasonal factors.

* – It is closely monitoring domestic prices for these 24
products. Prices for chicken meat and eggs are currently part of
“soft negotiation mode” and voluntary commitments between the
agriculture ministry and producers.

* – Russian sugar and sunflower oil producers have agreed
price reductions for their products with retail chains. The
current agreement is in place until the end of March.

The government has asked them to extend the agreements on
sugar until June and for sunflower oil until October.
($1 = 0.8477 euros)
($1 = 75.6480 roubles)
(Reporting by Darya Korsunskaya and Polina Devitt; Editing by
Jan Harvey)

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Published at Sat, 27 Mar 2021 10:08:12 +0000