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. Last Updated: 07/27/2016

Rail Snafu Hits Grain Exports

Grain exports may be prevented from rising to a record this month because of a shortage of rail cars, the Russian Grain Union said.

Russian traders have increased grain shipments as prices soared, and the government announced that export duties on wheat and barley would come into effect Nov. 12. Wheat prices have gained 64 percent this year as output fell in Australia, the United States and Canada, while inventories dropped close to a 26-year low.

"There is a serious shortage of rail cars from the North Caucasus to eastern Siberia," Sergei Shakhovets, head of information and analytics at the Russian Grain Union, said by telephone Monday. "Everybody's trying to ship before Nov. 12."

Russian Railways is short of at least 2,000 cars just in the North Caucasus and has asked Ukrainian Railways for assistance, Shakhovets said. Many traders have started using trucks to move grain to the ports in southern Russia, he said.

With sufficient rail capacity, Russia could export 2.6 million to 2.8 million tons of grain in October, breaking last month's record, Shakhovets said. Exports in September may have jumped to as much as 2.2 million tons, 58 percent higher than one year earlier, Shakhovets said, citing preliminary customs data.

The country will ship 11 million tons of wheat in the 12 months ending in June, according to estimates from the U.S. Department of Agriculture.