The Ministry of Agriculture has submitted for discussion a draft government decree on the beginning of the mechanism of state interventions for sugar. Document published on the federal portal of draft regulations.
If approved, the decision will be a new way of dealing with rising product prices. Currently, interventions are used only in relation to grain, with their help the state is trying to smooth out price fluctuations.
The mechanism operates in this way – during a period of low prices, the state purchases a product and thereby increases demand, which means it contributes to an increase in its value. When the product is scarce and it becomes more expensive, goods from stocks are thrown into the market.
At the same time, the draft also talks about changes in interventions in relation to grain. In its current form, sales from the state fund are carried out when prices have risen above the maximum calculated ones. It is proposed to start selling in the case when the price increase has exceeded 10 percent or more in comparison with the average price for the same periods in the last three years.
The Ministry of Agriculture will be responsible for deciding who exactly to sell raw materials from state funds. With regard to grain, they want to cooperate with flour mills and bakeries, and with respect to sugar – with trade.
To support flour producers, the department wants to create an irreducible grain supply in the amount of three million tons, that is, a need for two to three months. For sugar, such a stock should be 250 thousand tons. The purchases are going to be made in 2022-2023, if there are favorable market conditions and a corresponding decision of the government.
Earlier it was reported that on the eve of a record sunflower harvest in Russia, wholesale prices for sunflower oil began to decline. At the same time, the drop in prices in the world market is more noticeable.