FAS of Russia Recommends to Strengthen Control over the Grain Market

FAS of Russia Recommends to Strengthen Control over the Grain Market
Photo: unsplash.com 29.02.2024 385

Access to infrastructure will be a particular focus for the antitrust body.

On the recommendation of the State Duma, the Federal Antimonopoly Service of Russia will check the grain market for possible collusions among major market participants – producers, traders, transporters, etc. In case of revealing agreements that hinder competition, the antimonopoly service may start additional inspections. The reasons for such measures are the growing cost of bread and possible underestimation of grain prices during purchases, analysts say.

Examples of anti-competitive agreements may be cases when large agricultural holdings agree with the management of ports not to allow other players to store goods or when the purchase price of goods is artificially lowered for certain traders, explained Dmitry Tortev, a member of the Expert Council under the FAS. 

Experts point out that the problem of monopolization is most acute in the field of transportation (railways, ports). Agreements are unlikely among manufacturers —  this segment is quite competitive and unites tens of thousands of participants who would not be able to reach an agreement. This was stated by Arkady Zlochevsky, President of the Russian Grain Union, in the Izvestia newspaper. 

Leonid Kholod, former Deputy Minister of Agriculture of Russia, confirmed that the problem of access to infrastructure for agricultural producers is quite serious.

"It will not be solved without FAS involvement. How will you reconcile the potential of a super large agricultural holding and a single commodity producer? And both want to live and work,"

he noted. Therefore, vertical contractual chains, which leave the infrastructure for a large agricultural holding, benefit only them — although the infrastructure should be equally accessible, and in the end it can not use a sufficiently large number of agricultural producers, the expert concluded.

Source: Izvestia

agricultural markets  Russia 

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