The Office took the initiative to raise the duty rate from 20% to 50%. This is necessary to increase the processing of soybeans within the country.
Initially, the duty on the export of soybeans was introduced in December 2020, then it was 30%, but not less than 165 euros per ton.
Such a measure was invented to prevent a rise in prices for soybean oil and meal.
In fact, the problem was this: it was more profitable for Russian producers to sell soybeans abroad than to supply it to local processors. If they nevertheless bought it at high prices, this led to an increase in the cost of the final product.
However, from July 2021, it was decided to reduce the duty to 20%, at least 100 euros per ton.
As a result, it was possible to increase exports, which allowed manufacturers to extract more profit.
Currently, the duty has remained at the same level, and this rate has been extended until the end of 2024.
Why are they talking about revising the duty again?
The initiative to raise the duty again — and moreover, very significantly, more than twice and much higher than the previous level — was made by Deputy Minister of Agriculture of the Russian Federation Oksana Lut during a meeting with oilseed processors.
Actually, the whole point is just in them — processors. In 2022, Russia harvested a record soybean crop of 6 million tons, which is 23% more than the previous year.
It would seem that in such conditions it is extremely illogical to raise the duty and thereby block exports: Russians’ own consumption of soybeans is minimal.
However, a high duty would help to provide work for Russian processing enterprises. Currently, they practically do not develop and are not even built for the reason that they do not have enough raw materials.
Basically, we are talking about the Far Eastern Federal District, where at least 30% of all Russian soybeans are grown.
Far Eastern farmers are very willing to sell their crops to China, Japan and Korea — and this leads to the fact that local enterprises again get nothing.
If a new initiative to increase the export duty is adopted, it will actually become unprofitable to sell soybeans abroad, so all of it will go to Russian processors.
At the same time, you need to strike a balance and ensure a comfortable (not too high) level of soybean carry-over for the next season.
After all, as already mentioned, there are no sufficiently large number of processing enterprises in the Far East, and it is unprofitable to bring the harvest to the center of Russia because of expensive logistics.
At the moment, the Ministry of Agriculture is thinking about increasing the duty if soybean processors present effective roadmaps for their development.
