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Russia's Wheat Export Struggle

Carrying wheat stocks anywhere is expensive with the risk that quality will deteriorate. However, Russia, where the government will own most of the stocks, has less suitable storage facilities and thus a higher risk of quality loss than exists for the other three leading exporters who, along with India, are the other major stockholders. Thus, there seems to be a building anxiety among Russian exporters and the government to do something to pep up exports. There have been proposals floated suggesting that the government subsidize exports of its intervention stocks, discount transportation costs or otherwise do something to lower prices to a stock-clearing level.  With enlarged beginning supplies and prospects (so far) for a reasonably good wheat crop in 2010/11, the problem of burdensome stocks and the need for increased exports in the year ahead promise to be as pressing as they have been this year.

 

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USSEC Russian Market Analysis

The U.S. Soybean Export Council engaged World Perspectives to conduct an assessment of the Russian market for U.S. soybeans and soy products. WPI reviewed market dynamics, detailed the challenges in taking advantage of Russian demand and specified prospects for overcoming these constraints.

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