Private sector grain shippers in the Black Sea and Europe can breathe easy – Russia's state crops trader looks unlikely for some time to be able to live up to huge export ambitions, a leading Moscow analyst has said.

While the state export group, United Grain Company, has a target of shipping 16m tonnes of grain by 2015, even 4m tonnes this year looks "impossible", Andrey Sizov, Managing Director of Sovecon, said.

"There is simply not much time left in 2009 to do it," Mr Sizov told Agrimoney.com.

Financial snag 

But even getting shot of the 5m tonnes of grain targeted for next year looks a stretch, given the UGC's operational constraints, as a relatively new company with little infrastructure, combined with the financial implications of selling into a relatively depressed market.

UGC paid last year's high prices to build its 8m-tonne grain stockpile. The company, which is bankrolled by loans from state-owned Rosselkhozbank, would be unable to absorb significant losses without government help, which looks unlikely in the current economic climate.

"Somehow, the company has to replace those loans," Mr Sizov told Agrimoney.com. "I doubt the government will provide funds for that."

Plans rejected

The comments follow a report in the Kommersant business newspaper that Russian deputy prime minister Viktor Zubkov had rejected plans by UGC to sell up to 4m tonnes of grain at a 33% discount to last year's purchase price.

Mr Sizov's assessment will also ease pressure on grain exporters in Russia, and Europe, which have feared being undercut by a UGC with huge stockpiles and state backing.

"They have seen that the UGC has big plans for exports, and potentially a willingness to sell at very competitive prices," Mr Sizov said.