Billionaire Ziyavudin Magomedov is betting on Russia accounting for at least one-quarter of world grains sales in a quest by his investment group to snap up a near-50% stake in the country's state grain trader.

Summa Group, the engineering-to-telecoms group of which Mr Magomedov ranks as founder, chairman and shareholder, on Thursday confirmed its interest in the minority stake in United Grain Co which the Russian government is putting up for sale.

The investment reflects an expectation that Russia will build on its revival in grain exports, which deputy agriculture minister Alexander Solovyov on Wednesday pegged at 25m tonnes in 2011-12, up from less than 5m tonnes the previous season when drought prompted a ban on shipment.

"We expect that by 2020 Russia will be exporting 35m-40m tons of grain annually which will be 25-30% of the international turnover," a Summa spokesman told Agrimoney.com.

"That makes UGC an attractive investment."

Growing force 

Russia has already achieved astonishing growth in grain exports this century, with wheat shipments alone expected to hit 19.0m tonnes in 2011-12, on US Department of Agriculture estimates.

At the turn of the century, the post-Soviet record was 1.65m tonnes, set in 1998-99.

The boost has been achieved in part through recovering land, and reviving infrastructure, abandoned when the collapse of the Soviet Union prompted a drop in farm subsidies, with the rebound providing Russia with valuable foreign currency and food security, besides reducing the country's reliance on oil for exports.

However, some commentators believe that Russia has made the easy gains, with future expansion to be limited by factors such as infrastructure squeezes and a greater reliance on worse quality and more remote areas for land expansion.

Summa's other investments include a shareholding in Novorossiysk Commercial Sea Port Group, which owns the Novorossiysk Grain Terminal on the Black Sea, Russia's largest grain terminal.

Forced sale 

Russia is selling UGC to meet conditions laid down in terms agreed for the country's membership of the World Trade Organization early next year.

Dmitry Medvedev, the Russian president, in November authorised government to sell within six months a 50%-minus-one-share stake in UGC, with the country committing to sell all of the company in 2012.

Summa declined to comment on whether it would be interested in acquiring 100% of UGC.

Summa and UGC are already business partners in a plan to build a new terminal on Russia's Pacific coast, to facilitate exports to Asia, a major grain importing region.

Other Russian billionaires with investments in the country's farm sector include Oelg Deripasak, who has a 75,000-hectare farming enterprise in Krasnodar, Andrey Melnichenko, chairman of fertilizer group Eurochem, and Suleiman Kerimov, the top investor in potash giant Urakali.