1. The Impact of Russia’s 2010 Grain Export Ban
Dr. George Welton

2. Short term impact of ban
Does not seem to have kept food prices down.
Helped to accelerate food price increases globally.
Increased the costs for international consumers of Russian grain.

3. Long term impact of ban
Higher food prices (in Russia and global) as the ban:
Reduces investment in grain production in Russia – as it damaged the reliability of returns
Reduces trust in Russia as a grain provider
Increases the likelihood of food prices hikes in the future

4. Production of Grain 1992-2009 (million tons)
1992
1995
2000
2005
2006
2007
2008
2009
% of total grain crop in 2009
Wheat, winter and spring
46.2
30.1
34.5
47.6
44.9
49.4
63.8
61.7
64%
Barley, winter and spring 27
15.8 14
15.7 18
15.6
23.2
17.9
19%
Oats
11.2
8.6 6
4.5
4.9
5.4
5.8 6%
Rye, winter and spring
13.9
4.1
3.6 3
3.9
4.3 4%
Corn for grain
2.1
1.7
1.5
3.1
3.5
3.8
6.7 4
Other
6.392
3.06
3.88
3.28
3.95
3.41
4.16 3%
Total
63.4
65.3
77.8
78.2
81.5
108
96.6
 100%
Grain production has increased since

5. Exports of Wheat and Rye 2006-2010 (Calendar Year)
2007
2008
2009
2010
Volume (million tons) 9 14 12 16 11
Total value ($m)
1319
3544
2875
2624
1849
Price per ton ($)
142
251
245
163
175
As a e

6. Russian agricultural policy up until 2010
1990’s and failed liberal market reforms
Agriculture as a priority in 2005 and increase government spending
Programme for the Development of Agriculture, Regulation of Commodity Markets and Rural Development for the Period of (2007)
Food Security Doctrine (2010)

7. Key components of the 2008-2012 Russia Agricultural Development Program
Title
Description
Total planned spending (billion roubles/£)
Sustainable rural development
General spending on rural infrastructure and access to social services in rural areas
($4)
Creation of general conditions for functioning of agriculture
Mostly spent trying to support and improve soil fertility, some information provision and the development of agricultural support services
66.55 ($2.4)
Priority agriculture subsector development
Supporting the growth of brood livestock, veterinary services, subsidies of feed development in the North
72.66 ($2.6)
Financial sustainability of agriculture
Offering subsidised loans to a variety of sectors, particularly meat
($10.5)
Agriculture product market regulation
Smoothing out price variations, particularly in grain, by buying when price is low and selling when it is high.
7.01 ($0.25)

8. The 2010 food crisis and export ban

9. 2010 July drought

10. Consequences of the drought
43 regions affected
17 per cent of the total crop area destroyed
Rise in grain prices
Government’s market intervention
Imposing an export ban in August, 2010

11. The impact of the ban on wheat prices

12. The impact on poor and vulnerable groups
No clear evidence that the ban kept food prices at low level
Small share of grain and bread in household expenditures
Universal rather than targeted assistance

13. Composition of the subsistence minimum 2000-2009

14. Primary Export Countries for Wheat July 2008 – Feb 2009 (thousand MT) and their relative wealth in per capita GDP
Rank
Country
Jul 08 - Feb 09
GDP per capita ($PPP) World Bank (2009) 1
Egypt
3,156
5,673 2
Turkey
1,576
13,668 3
Azerbaijan
972
9,638 4
Pakistan
943
2,609 5
Syria
552
4,730 6
Iran
542
11,558 7
Bangladesh
459
1,416 8
Jordan
438
5,597 9
Yemen
386
2,470 10
Tunisia
327
8,273

15. Long-term impact Global price instability
Lower investment in grain production
High prices of meat and grain if protections in meat industry is continued
Damaging Russia’s reputation as a supplier
Under-use of a key resource

16. Recommendations Export bans should be avoided
For keeping domestic prices low, it’s better to give direct subsidies to producers, than to impose a ban
For vulnerable groups, policies should be targeted
Need for investment in grain industry to balance the meat industry will be good in the long-term
Import quotas for meat industry should be avoided