0 votes

Third Largest Wheat Exporter Bans Exports Due to Drought

MOSCOW (AFP) – Russia, the world's third wheat exporter, Thursday banned grain exports for the next four-and-a-half months due to a record drought that has destroyed millions of hectares (acres) of its land.

Wheat futures shot up to new two-year highs on commodities markets after the sudden announcement from Prime Minister Vladimir Putin raised concerns about global grain supplies.

"In connection with the unusually high temperatures and the drought, I consider it right to impose a temporary ban on the export from Russia of grain and other products produced from grain," Putin told a government meeting.

Russia earlier this week slashed its 2010 grain harvest forecast to 70-75 million tonnes, compared with a harvest of 97 million tonnes in 2009, owing to the worst drought for decades.

Continue...

You think something big isn't up?



Trending on the Web

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.

Meanwhile we're still paying people NOT to grow, right?

Just checking....

Integrity means having to say things that people don't want to hear & especially to say things that the regime doesnt want to hear -RonPaul

bump

Thanks for posting this Michael.

LL on Twitter: http://twitter.com/LibertyPoet
sometimes LL can suck & sometimes LL rocks!
http://www.dailypaul.com/203008/south-carolina-battle-of-cow...
Love won! Deliverance from Tyranny is on the way! Col. 2:13-15

Hey, man - head's up...

With comments like this:

You think something big isn't up?

you might be considered a crack-pot, kook, or worse. Folks will try to kick you off of here, man.

[/sarcasm]

Yes, something big IS up.
While our nation is doing all it can to ensure our food supply is either regulated or Genetically-Modified, others are preparing for a crisis.

All of a sudden this song from my childhood popped into my head...
http://www.youtube.com/watch?v=c34_BSPV8hI

We're not hearing this tune from folks that should be telling us... a KOOK would think it had something to do with Agenda 21... but they're KOOKs.

I think its a smart move for

I think its a smart move for Russia's interests. They are having record heat and severe droughts which are either causing fires or a symptom of how dry it is. For them they got to make sure the grain costs in their country remain on a stable level.

Not a big fan of the 1 billion dollars they are sending in aid. BUT that is their country and they have a right to do what they want.

Its a pretty big market intervention

I definitely know it won't have the desired effect. Case in point wheat futures shot up, so now if they need to import wheat (which I doubt) it will cost the people more. Screws the farmers pretty good who are already suffering from low yields in the drought so now they can't sell their grain on an international market to get maximum compensation for what little harvest they have. Poor farmers=less farmers=more expensive grain in the future.

Governments would be better to let markets work at all times. Russia hasn't understood that for many years though.

Agreed,

Agreed, less incentives for farmers to grow next year.

Mises.org
Know your stuff, learn real history and economics @LibertyClassroom.com

more incentives for farmers outside of Russia to plant wheat

hence a lower price is almost certain for when the export ban is lifted...so the Russian farmer gets double dicked.

False signals in the market place hurt more than they help. The best cure for low prices is low prices, but who is any american to preach about socialist farming...is there any other way its done?

ok

Ahh ok. Thanks for the other comments.

But from the article they were exporting about 21 million bushels. They usually take in about 90 million bushels. They were only expecting about 70 million to come in this year. So I don't expect them to be importing too much.

But I do agree now that they have done this, they have unintended consequences for what they felt was a good intervention.

Austrian economics says you can't predict

anything, but you can predict any state intervention into the market place will have more negative impacts over the long term than positive impacts. Sorry if we all aren't well rehearsed Russian wheat market experts.

We were just throwing out possible outcomes from the intervention and we certainly can't predict what say, england, for example will enact for legislation to further distort the wheat market.

Bottom line is this intervention will do more harm than good for Russian wheat farmers and most likely Russian wheat consumers.

Pretty interesting stuff

I wonder who they exported most of their grain to?

I was wondering the

same thing.

"We can see with our eyes, hear with our ears and feel with our touch, but we understand with our hearts."