Russian sunflower oil producers urge government to hoist sunseed export duty

FILE PHOTO - A sunflower field is seen along the way to Russia's southern city of Rostov-on-Don, September 8, 2010. REUTERS/Ilya Naymushin

MOSCOW (Reuters) - Russian sunflower oil producers have urged the government to more than double the tariff on sunflower seeds, to keep a lid on rising exports which they fear will further inflate seed prices at home.

Prices of sunflower seeds, sunflower oil producers’ main raw material, have risen 9 percent since mid-May to 19,125 rubles ($319) per tonne, according to SovEcon agriculture consultancy.

Russia’s Sunflower Oil and Fats Union, in a letter dated June 26, asked the Economy and Agriculture Ministries to raise the tariff to 16.5 percent, but not less than 100 euros ($114) per tonne, from the current 6.5 percent but not less than 9.5 euros per tonne.

“With the aim of eliminating the existing disparity of export prices and critical risks for the (sunflower) oil and fat industry, I am asking you ... to consider the question of an urgent upgrade of the export duty on sunflower seeds,” Mikhail Maltsev, acting head of the union, said in the letter.

The ministry said on Friday that it was considering the request.

Russia, a major sunflower oil exporter, cut export duty on sunseeds last year to 6.5 percent, from 20 percent, in line with its terms of membership of the World Trade Organisation. It was unclear how much scope it had to push the tariff back up again.

The reduction, along with Russian efforts to support its sunflower oil industry and exports, led to a fivefold increase in sunseed exports between last September and June this year, official data showed.

SovEcon agriculture consultancy said last month that Russian sunflower oil producers were worried by rising seed exports and had asked the government to impose additional measures to limit them.

Reporting by Olga Popova, Darya Korsunskaya and Polina Devitt; writing by Polina Devitt; editing by Susan Fenton