Grain export ban extended to July

Russia will lift the export ban on wheat flour staring January 1 next year but the ban on overseas sales of grain has been extended to until July 1 to ensure domestic supply after drought damaged crops, Prime Minister Vladimir Putin said.

More than a third of Russia’s grain crop was ruined by the worst drought in at least a half century, prompting the government to impose a grain-export ban on August 15.

The ban was scheduled to be reviewed on December 31, but Putin signed the extension last Thursday.

At a government meeting on Friday, he said: “The stability of our internal food market and the feed for livestock must be the priority.”

Wheat prices in Chicago as much as doubled since June as Russia’s drought, flooding in Canada and parched fields in Kazakhstan and Europe decimated crops. Ukraine, once the world’s biggest barley exporter, introduced export quotas this month after a smaller-than-expected harvest.

Russian farmers reaped about 60 million metric tons of grain this year, and the country has enough supply to meet domestic demand, Putin said. Winter-grain plantings totalled about 13.2 million hectares (32.6 million acres) as of Octocer 20, almost 4 million hectares less than a year earlier, the prime minister said.

Russian wheat exports are forecast to slump to 3.5 million tons in the 12 months ending in June 2011, compared with 18.56 million tons a year earlier, according to the U.S. Department of Agriculture.