Farmers Ask State for $1.75Bln in Subsidies

The country's farmers asked the government for as much as $1.75 billion a year in subsidies for grain exports as the global financial crisis drives up the cost of borrowing and grain prices fall.

Russia's Grain Union proposed subsidies of $60 to $70 a metric ton, Igor Khudokormov, chairman of grain and sugar producer Prodimrex said Wednesday after a meeting chaired by President Dmitry Medvedev. Russia may export as much as 25 million tons of grain this season, according to the Agriculture Ministry.

Speaking at a meeting of the Russian Agrarian Movement, Medvedev called for the government to shorten to 30 days the period for refunding the value-added tax on exports for Russian agricultural firms.

"This takes two days abroad, for us it stretches out over months," he said.

The president also harshly criticized government agencies for delaying a law that would make it easier for farmers to sell their products in grocery chains.

"We've dealt with this garbage long enough," he said. "I've talked several times … about the so-called bonuses to sell their products in grocery chains. We know that these pretty words amount to nothing more than a kickback that keeps the farmer weak."

Other measures discussed Wednesday included lower rail and port charges for exporters, Khudokormov said.

Bloomberg, MT