MOSCOW - Russia's top agriculture official said on Wednesday the country was set to boost its grain exports by a half this year, and was looking for new markets in Northern Africa and possibly Canada.
Agriculture Minister Alexei Gordeyev said that after decades of shortages Russia had a healthy grain surplus, adding that poor harvests in major exporting states and booming prices were encouraging exports.
"Our forecast shows that grain exports will rise 40 to 50 percent this year to about eight million tonnes," said Gordeyev, who is also a deputy prime minister.
"Because the harvest was weak this year in many exporting countries we could try to enter new markets," he added. Last year, Russia exported around five million tonnes of grain.
Gordeyev's comments amount to a slight lowering of expectations after his first deputy Anatoly Mikhalyov said last week grain exports could double this year to 10 million tonnes.
Gordeyev was speaking to reporters after meeting Lyle Vanclief, the Canadian agriculture minister.
Drought in some suppliers of wheat such as Canada, the United States and Australia, have taken a toll. Many European states lost crops in August floods.
Gordeyev said Russia was well placed to test the Canadian market. But Vanclief said the two men did not discuss that.
"We are going to have sufficient high-grade wheats for our milling industry but there may be an opportunity for feed wheat for livestock industry," Vanclief said.
Canada 2002/2003 wheat output is seen falling to 15.45 million tonnes, the lowest since 1974.
"I think Russia has good chances (to test the Canadian market) because our production costs are much lower," added Gordeyev.
Both ministers declined to confirm comments by Mikhalyov last week that Canada had decided to purchase Russian grain worth 12.6 million Canadian dollars ($8.12 million), a sum analysts says would be equal to 50,000 tonnes of high quality food wheat.
RUSSIA EYES EGYPT, IRAQ
Russia, a net grain importer since tsarist times, first started exporting large volumes of grain last year, when it enjoyed a record harvest of 85 million tonnes.
Gordeyev said the initial forecast for grain output this year of 75-77 million tonnes was too low and the final volume harvested would be higher. But he declined to say whether it might be equal or even surpass last season's.
"We have to see how the harvest proceeds in Siberia. Currently it is raining over there and we don't have a clear weather forecast," he said.
However, he said there was no doubt Russia would have to find new export markets this year: "We have plans to explore markets in Northern Africa, where Egypt alone imports up to six million tonnes of grain a year".
Another option, he said, was boosting supplies to Iraq under the U.N.'s oil-for-food humanitarian programme. Russian firms are among the biggest lifters of Iraqi crude oil.
"In previous years, Russian firms used to buy grain from Australia to fulfil their quotas. Now we could supply our own grain. This is up to one million tonnes a year," he said.
Vanclief also said Canada may export wheat to Iraq this year despite official reports denying contacts between the two sides.
"We supplied some wheat to Iraq last year. It is my understanding that there may be some of that type of commerce taking place this year," he told Reuters.
He did not say whether the sales would be conducted out through state or private exporters. Last month, Iraq's trade minister said Baghdad was in talks with Canada.
But the Canadian Wheat Board, which holds a monopoly on grain exports from Canada's prairies, said the two countries had held no talks, and cited harsh local crop conditions.
The move came after Iraq, labelled by the United States as part of an "axis of evil", lifted a one-year-old boycott of Canadian wheat in August, imposed after Canada supported U.S. air raids on Iraq. /Reuters/ - [12 Sep 2002]
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