Russia is waiting for a grain trap: a record wheat harvest may turn sideways

There are no final results of grain harvesting in Russia yet. But it is already clear today that the record harvest will result in problems with its integrity and safety. Due to the hidden sanctions of the European Union, the Russian Federation is unlikely to be able to send millions of tons of wheat to the starving countries of Africa. But the capacities of the elevators do not allow holding grain until better times for the peasants, when prices for them go up.

According to the latest data, as of December 1, 156.2 million tons of grain in bunker weight were harvested in Russia. Of these, wheat, the main export crop, is over 105 million tons. With such a gross harvest, our farmers have repeatedly stated that they are ready to supply 50 million tons of grain to non-CIS countries. However, due to economic sanctions and various delays by the European Union, according to analysts, we will be able to export about 26 million tons, half as much as possible.

Where and how to store a record harvest of bread? The question is not idle. Elevators, as you know, are not rubber. It is believed that their volume is designed to receive 120 million tons. It turns out that with the current harvest, more than 30 million should have been left in the field? At the same time, modern elevators with “smart” technologies are able to accept only about 40 million tons, the rest of the volumes are brought to unsuitable premises. Which leads to a loss of yield and a deterioration in quality by 10%.

The lack of elevator capacities is explained by the fact that during the Soviet era they were created in places where grain was consumed, near large metropolitan areas, where the harvest was delivered from different regions of the country. Now this policy is recognized as erroneous: warehouses and terminals, it turns out, are necessary where the crop is specifically grown. There is a gap: near large cities, such capacities are empty, and where grain growers work, there is not enough capacity.

At the same time, it is still not completely clear: what is the correct policy – the one that was in the USSR, or the one that exists today? Perhaps time will tell.

The situation is in some ways reminiscent of the recent story of storage for vegetables. About 10-15 years ago, modern distribution centers with state-of-the-art equipment began to be built near large cities – Moscow, St. Petersburg, Yekaterinburg. Producers had to bring potatoes, cabbage, onions and carrots there. Large funds were allocated for the state program, they were actively mastered. Now this decision has been recognized as erroneous: climate-controlled storage facilities are being built in vegetable production areas.

In both cases, the result is the same: at the moment, there are only 30% of modern high-tech vegetable stores in Russia. It is not surprising that vegetables from Azerbaijan, Turkey or Egypt have been coming to us since March. By and large, the situation is not the best – and with storage facilities (elevators) of grain.

Do we need to be afraid that “overkill” of bread will result in its large losses during storage? And when will record harvests stop being a headache for Russian farmers?

We asked these questions to the agricultural analyst, Deputy Head of the Grain Union Alexander Korbut.

-​ How acute is the problem with the preservation of the crop today? How many grains will be left “overboard”?

– I’m not sure that’s a lot. Peasants are sane people, they understand well that even in the current situation, with the current low prices, it is necessary to sell the grown crop. After all, the costs of its production have been incurred, and it is necessary to recoup them at least partially – even if at the level of cost or below it. In any case, this will have to be done.

“But large volumes are stored in unsuitable conditions. What will happen to them?

– Of course, food wheat will lose in quality, go into fodder, livestock feed. This is not the best option, but forage grains are also needed by animals. However, there is hope that this will not happen. Most likely, in the near future, our grain exports will “fire up”, from which sanctions are lifted. Large volumes of grain will leave our market. Which also stabilizes the situation. We do not need much wheat for our domestic consumption.

The key issue today is the sale of the harvest. According to my estimates, the current grain storage capacity is 150-155 million tons. However, it should be noted that it is necessary to store not only grains, but also oilseeds. And this is another 25 million tons.

– So when can we stop fearing record harvests for fear of losing them?

– In recent years, new elevators have been actively built in Russia and granaries have been modernized. There is no special state program, but there is concessional lending for the construction of such facilities. This year’s harvest is not just a record – it is extreme. Thanks to the weather conditions, we received “extra” 20-25 million tons. However, the producer will see if it makes sense for him to engage in grain when high achievements turn into low prices, when sales are at a loss. There is no economic sense in such production.