Putin pushes government to extend controversial grain subsidy

A controversial scheme which helps farmers get cereal products onto the export market by providing indirect subsidies should be extended, Russia’s president Vladimir Putin has told the government.

Instructions following the president’s annual address to both chambers of the Russian parliament on March 1 were published Friday, and showed Putin tasking prime minister Dmitry Medvedev and his government with extending the scheme by July 15.

The publication of the announcement comes days before Russia votes in a presidential election, with Putin widely tipped to hold on to the post he has occupied twice, most recently since 2012.

A rail freight reimbursement scheme has been in operation since the start of the year, with the government paying the state rail operator to provide cheaper transport for grain sellers to help get this year’s record breaking crop from remote parts of the country onto the export market.

The latest figures showing 868,100 mt of grain worth RUB 821.1 million ($14.2 million) has been provided with subsidised freight.

The news comes at the same time as ministry of agriculture official Anatoly Kutsenko told an audience in Moscow he expects Russian cereal exports in 2018 to top as much as 50-52 million mt, with wheat exports coming to 36-37 million mt.

The economist’s figure is significantly higher than the ministry’s current estimate of 45-47 million mt, a figure which minister of agriculture Alexander Tkachev repeated at a government meeting Thursday.