In the next agricultural year, the Russian “daughter” of the American company Cargill will stop exporting grain from Russia. Company representatives reported this in a letter to Oksana Lut, Deputy Director of the Ministry of Agriculture, reported by Russian RBC .
The fact that Cargill will stop the export of grain from Russia was told by two other interlocutors of the publication on the grain market.
In the letter, the company states that during the upcoming 2023/2024 agricultural season (from July 1, 2023 to June 30, 2024), Cargill LLC does not intend to export grain from Russia “in accordance with the previous discussion on grain export issues and recommendations of the Ministry of Agriculture”.
At the same time, company representatives promised that shipments planned for the 2022/2023 season would be carried out “in full in accordance with the existing quota”, writes RBC.
Cargill’s Russian “daughter” also said it was beginning to review its portfolio of grain export-related assets. The company said in a statement that changes to “any other Cargill business and assets in Russia are not planned and are not contemplated.”
The press service of the Ministry of Agriculture confirmed to RBC that it had received a notification from Cargill. Representatives of the company’s Russian office at the time of publication did not respond to the publication request.
Cargill is one of the world’s largest manufacturers and suppliers of food and agricultural products. The company has been operating in Russia since 1991. Cargill sources, processes and transports grains, oilseeds and other raw materials for food and feed manufacturers, supplies food and beverage manufacturers, retailers and restaurants in meat products and ingredients, partners with industrial consumers of energy, salt, starch products and steel products, and also provides financial services to customers in these industries. In March 2022, after the start of the military operation in Ukraine, Cargill stopped investing in Russia, but its local businesses continued to operate.
Experts interviewed by RBC believe that Cargill’s decision will not affect the total volume of grain exports from Russia. According to the publication, in the 2022/2023 season, the company will supply 2.2 million tons of grain to world markets, which is almost 4% of all Russian exports.
The RBC interlocutor explained that Cargill had decided to stop exporting due to increased regulation and pressure on this market from the state.
The Ministry of Agriculture also believes that the cessation of Cargill’s export activities in the Russian market will not affect the volume of domestic grain deliveries abroad. According to the ministry, its grain export assets will continue to operate regardless of who manages them. The Russian Ministry of Agriculture is ready to work with all foreign companies whose activities contribute to the development of the Russian domestic food market and its export potential, reports RBC. The ministry also pointed out that vacant market niches are quickly filled by domestic players.
March 27 RBC wrote that the Ministry of Transport, the Ministry of Agriculture and the Federal Antimonopoly Service will find a way to stabilize the cost of transporting grain and prepare a mechanism for regulating the prices of transport services. The publication notes that the increase in the cost of logistics against the background of falling prices in the period of record harvest affects the profitability of the production of farmers and the food security of the country.
