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Russia Going After US Grain Customers


Russia going after US grain customersRussian media sources are announcing that for the first time in modern history the Russian grain production surplus has exceeded storage capacity. Thus, Russia is aggressively pursuing an increased market share for its grain exports in Latin America countries, primarily Mexico and Brazil at the expense of the US market share. It is aided in this endeavor by the rise of the US dollar versus the local currencies, making American grain relatively more expensive. On the other hand, the glut in grain supply has caused prices to go down, hurting revenues. As an editorial note, we might add that this development reflects well on the modernization of Russian agriculture; the USSR in comparison, was never able to produce sufficient grain even for internal consumption, resulting in imports from the US and Canada. This was true even when the Ukraine, the so called “breadbasket of Europe” was part of the USSR. The need to import grain was a major strategic weakness for the USSR and a contributing factor in its defeat in the Cold War and subsequent demise. It appears that now that weakness has been corrected as far as Russia is concerned.

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