Translated material
Wild growing
According to federal authorities, food prices in the country are rising for no reason
“There will be no shortage of products. Those who are trying to make money by causing panic will be dealt with by the FAS and the Prosecutor General’s Office,” this post on Dmitry Medvedev’s Twitter appeared yesterday after a meeting of the State Council Presidium he held in Saratov. But the current problems of food security, or more precisely, the significant increase in food prices due to the consequences of the drought, will not only be dealt with by prosecutors and antimonopoly officers. As a result of the meeting, Mr. Medvedev initiated the creation of a new government commission, which, apparently, will have to study the economic, rather than the criminal, nature of rising prices. The current authorities, apparently, are not enough for this.Mr. Medvedev said that he would instruct the government to create a commission “to monitor and promptly respond to changes in food market conditions.” This commission, he said, should work “not always”: “In this difficult year, let it work to coordinate the positions of the federal center, regions, respectively commodity producers and relevant self-regulatory organizations.” What the specific result of these agreements should be is not entirely clear. As well as the temporary principle of the commission's work - which will be the criterion for intensifying and, conversely, curtailing its activities. Vremya Novostey’s Kremlin sources found it difficult to answer the question of what the bureaucratic status of the commission would be, suggesting only that its head “most likely” could be the head of the Ministry of Economic Development.
Before the meeting with officials, Dmitry Medvedev personally inspected prices in the Saratov region. He started the morning with a visit to the Trudovoy breeding plant, located in the city of Engels, bordering Saratov. From there I went to the field where melons are grown, and then inspected the dairy and meat plants. On the way, the president managed to stop by a regular store, where he talked with a few customers. He asked them how food prices were in the city. In particular, the president was interested in the cost of milk, bread and eggs. “It’s normal,” responded one of the buyers, adding that he had not noticed a sharp increase in prices. Mr. Medvedev also asked about one of the most pressing topics recently - the cost of buckwheat. The couple of buyers evasively answered him: “If you eat only this, then it will probably affect the family budget. But we eat different foods."
“We have developed some psychosis regarding buckwheat. We'll deal with buckwheat. These are speculators. Someone started a rumor that there was a bad harvest. They are instilling fear,” the head of state explained the situation to them, promising to strictly suppress speculative manipulations. On leaving the store, another woman confirmed to him that there were no problems with this cereal in the city. True, at the same time she asked with a sigh to “make prices lower.” “This is what we are doing,” Mr. Medvedev assured her. In addition, he said that pensions would soon be increased not only for military pensioners, but also for everyone else.
Meanwhile, in a conversation with a Vremya Novostei correspondent, a resident of Saratov said that the reassuring assurances from her fellow countrymen do not correspond to reality. According to her, buckwheat appears in stores and then disappears again. Moreover, recently it has doubled in price - from 30 to 60 rubles. As for the price of eggs, it has recently increased by 10-15%. Milk has also risen in price, but this happened a relatively long time ago.
Be that as it may, Mr. Medvedev began the meeting of the State Council by declaring that the situation in the Saratov region was generally normal. However, there are warning signs coming from other regions.
“And this despite the fact that there are no real prerequisites for a rise in prices,” he said, once again blaming speculators for everything. The President said that, even according to the most pessimistic forecasts, 60 million tons of grain will be harvested this year. Taking into account previous reserves, this is more than enough. “We will not have a shortage of meat, milk or flour,” he added.
In this regard, Mr. Medvedev said, the authorities should pay special attention to unjustified price increases. “The special services should deal with those who inflate prices,” the president is convinced. He explained his idea by describing a situation where in the evenings all the buckwheat is taken out of large retail stores, which is then sold in small quantities in markets. It is clear that it is easier for a store to sell all its cereal at once, but this will already be wholesale, and this store should only engage in retail, the president said.
In addition, the head of state emphasized the need to control the expenditure of funds allocated by the state to support agricultural producers from the affected regions. We are talking about the amount of 35 billion rubles. At the same time, Mr. Medvedev called on banking structures to be more tolerant of payments on loans issued to farmers, “if necessary, they (loans. - Ed. ) can be extended."
The president asked railway workers to reduce tariffs for transporting grain to the affected areas. “If this is not done, then all the accepted compensation measures will be meaningless,” he said. Vladimir Putin will also have to think about preferential railway tariffs. “In order to eliminate the possibility of a grain shortage, consider the issue of temporarily establishing exceptional preferential tariffs with a coefficient of 0.5 for the transportation of grain by rail, as well as products of its processing and seed material to regions affected by drought in 2010, from the South and North Caucasus and the Siberian federal districts,” says the order to the head of government, the signing of which the president announced at the State Council. The deadline for completing the order is September 7.
Dmitry Medvedev returned to the topic of transport costs once again. According to him, Muscovites would faint if they visited the Saratov market, since prices there are five to seven times lower than in the capital. “It is clear that there is transportation, there is infrastructure, but still there should not be such a difference,” Mr. Medvedev said. However, he himself, having asked the price of local cucumbers and tomatoes at the market, did not faint, just as he did not buy vegetables on the cheap.
Minister of Agriculture Elena Skrynnik began her speech by showing the audience loaves of white bread purchased in different Russian regions. At the same time, according to her, the prices for bread were approximately the same everywhere - only bread in Tatarstan was slightly more expensive, but it was also heavier.
The minister said that over the past couple of years the cost of grain has decreased by about 35%. During the same period, bread prices increased by 10-20%. In other words, Elena Skrynnik continued, the cost of bread and the cost of grain are very conditionally related. At the same time, she recalled that the cost of grain forms only 20% of the final price of a bread product.
Like the president, the head of the Ministry of Agriculture blamed the rise in prices on speculators. And she also stated that the situation is far from critical. Although the authorities have the right to set a ceiling on prices if they rise by 30% within one month, this has never been used, the minister explained.
Elena Skrynnik reported that approximately 45 million tons of grain have already been collected today. Next year, in order to avoid excesses in the market, it will be necessary to collect about 85-90 tons. This is quite realistic even in the event of any climatic emergency. The minister also noted that although the meat market is sensitive to fluctuations in grain prices, the cost of meat products is stable. According to her, there will be no problems with milk and meat. It is curious that this statement goes against the global trend. According to the Financial Times, citing UN information, the cost of meat products has reached a 20-year record. Thus, meat prices in August of this year increased by 16% compared to last year.
Minister of Economic Development Elvira Nabiullina spoke out categorically against transferring to the regions the right to set price restrictions on a number of food products. In her opinion, this should be the exclusive prerogative of the federal authorities, otherwise a shortage will inevitably occur, since if one region introduces restrictions and another does not, the goods will naturally begin to flow to places where there are no price barriers. Dmitry Medvedev supported this position. Moreover, according to Ms. Nabiullina, there is no need yet to limit price increases at the federal level (the Law “On Trade” provides such an opportunity).
Summing up, the president noted: “What I heard here makes me moderately optimistic. Our government and ministries work in close contact with commodity producers, with associations and self-regulatory organizations of commodity producers and with the regions.” In his opinion, the month during which it became clear that difficulties might arise in the food market (August) “was not wasted.” “I do not intend to remove this topic from control and will spend the entire month of September rattling the government and regions on this topic so that we understand the situation we are in,” the head of state concluded.