World Grain - October 2008 - 18

newsreview
Russia's bumper grain crop could create storage shortfall
MOSCOW, RUSSIA - Russia may run
out of grain storage capacity after the largest harvest in at least 15 years, which could
threaten the government's plans to increase
output and exports, Bloomberg reported
Aug. 21.
Russia's Grain Union said the country
can currently store about 95 million tonnes,
but the government forecast the grain harvest to be at least 85 million tonnes. The
grain union expects farmers to reap 97
million tonnes
"This year showed a real lack of storage
capacity,'' said Igor Khudokormov, chairman of Prodimex, a Russian sugar and
grain producer. "Nobody was ready for
this. Now we are having a lot of problems
to store the wheat and barley, and all the
grain crop."
Russia should build more elevators in
the southern and central parts of the country, where the majority of the country's
grain is produced and exported, Grain
Union Vice-President Alexander Korbut

CN found in breach of service
to four Canadian grain shippers

told Bloomberg.
Korbut estimated construction costs for
100,000 tonnes of capacity to be about
$16.4 million, excluding costs for rail,
road and power connections.
The number of available rail hopper
cars and access to ports is also an issue,
he said.
The country has 12,500 hopper cars for
grains, more than a third fewer than are
needed, according to the Grain Union. Of
the total, 5,500 are more than 20 years old.
Russia's total port capacity to export
grain stands at about 15 million to 18 million tonnes a year. The country can also
send some shipments via Ukraine's ports
on the Black Sea and through Baltic ports,
Korbut said.
The Russian government's plans for a
state grain trader that may control about
half of all overseas sales could help improve infrastructure, Khudokormov said.
The government will hold a 25% stake,
with the rest owned by private firms.

OTTAWA, ONTARIO, CANADA - The Canadian Transportation Agency (CTA) ruled
Sept. 25 that the Canadian National Railway
Company (CN) did not meet its obligations
under the "Canada Transportation Act."
The CTA found that CN has failed to
provide an adequate and reasonable level
of service to North East Terminal Ltd.,
Paterson Grain, Parrish and Heimbecker
Ltd. and North West Terminal Ltd. The
CTA found that CN had not breached its
level of service obligations to the Canadian Wheat Board (CWB) and Providence
Grain Group Inc.
Effective immediately, CN must:
* Confirm a minimum of 80% of the
grain shippers' requested rail cars;
* Deliver 90% of these confirmed cars
on time or in the subsequent two weeks; and
* Meet these performance standards on
a 12-week rolling average throughout each
crop year. CN is still obligated to deliver all
remaining confirmed rail cars.

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18

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World Grain - October 2008

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