Black Earth Farming has defied forecasts of a drop in Russia's grain this year by predicting a small rise, in a report which also alerts investors to the potential ending of intervention buying by Moscow.

The Russian farms operator said that "the prognosis" for 2010 was a harvest of 98m tonnes, up 1.3% year on year.

The data comes a day after Russia's deputy agriculture minister, Sergey Korolev, pegged the crop at 95m tonnes, a forecast in line with analysts and ahead of estimates of "in excess of" 90m tonnes from the Russian Grain Union head of the state grain trading company.

"The amount of land planted with winter crops has increased," Black Earth said, reporting a rise of 5% in sowings.

Intervention suspension?

The company, in a list of factors for investors to "keep an eye on" for 2010, also noted forecasts of a rise of 4.5% in Kazakhstan's grain crop and of 4% in Ukraine's, and of uncertainty over future intervention purchases when Russia's state stocks had hit 8m tonnes at the end of last year.

"The repetition of intervention buying in 2010 is uncertain, not the least because of the vast amounts that the government needs to pay for storage of the grain already acquired," Black Earth said.

The costs have been reported to Agrimoney.com as 62 roubles per tonne per month, implying a charge of some $17m a month on Black Earth's state grain inventory figure.

The company also highlighted a fall in domestic prices following the end last month of Russia's 2009-10 intervention programme.