Posted on 08/04/2003 11:29:18 AM PDT by RussianConservative
Russia said Friday it would help Ukraine overcome grain shortages by supplying up to 200,000 metric tons of grain this month to its neighbor, where output is likely to plunge to a record low due to bad weather.
Agriculture Minister Alexei Gordeyev, speaking after talks with Ukrainian Prime Minister Viktor Yanukovych, said Russia would supply the grain this month. Russia's crop is also expected to be sharply lower this year.
Yanukovych said deliveries from Russia might reach 1 million tons in September. It was unclear how much the grain would cost, but Gordeyev said delivery prices would not exceed Ukraine's domestic grain prices.
"As it goes between good friends and neighbors, particularly relatives, we can offer our shoulder and deliver grain to Ukraine," President Vladimir Putin said after the talks at a presidential residence outside Moscow.
Last year's substantial harvests in Russia and Ukraine helped both countries further establish themselves as emerging grain exporters, but a severe winter and summer drought have curbed their ambitions.
Putin said grain prices in Ukraine were "artificially inflated" and suggested Kiev pay for Russian deliveries with "a goods credit note."
"I mean Ukraine has become a major grain producer itself, and it can return the grain next year, naturally with a small amount in interest," he said.
Weather forecasters say Ukraine's crop could fall to 20 million tons, about half last year's total, as millions of hectares of crops have been damaged, pushing up grain prices.
Gordeyev said both governments needed to settle technical issues before shipments could begin.
He added the decision to help out Ukraine would have no effect on Russia's grain market, also subject to grain price rises as the 2003 crop is forecast at 70 million tons against last year's 86.6 million.
Ukrainian prosecutors have opened hundreds of criminal cases, claiming widespread corruption and criminal activity caused a grain deficit that led consumers to clear store shelves of basic staples after prices soared this summer.
Serhiy Dombrovsky, head of the prosecutor general's department for legal compliance, accused officials last week of corruption and misuse of state funds in failing to regulate Ukraine's food market. He also blamed traders and retailers for fueling the crisis by allegedly taking advantage of disastrous grain harvest reports to hike prices.
President Leonid Kuchma ordered the crackdown to stabilize the grain market after panicked consumers hoarded flour, buckwheat, pasta and sugar last month after prices skyrocketed amid reports that an exceptionally harsh winter and dry summer had wiped out the bulk of Ukraine's crops.
Officials have accused traders and farmers of intentionally inflating harvest figures and reserves to hide secret sales that aggravated the shortage
And Russia wants it back once Ukraine is done with it? Yeeek.
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