Time is Ripe for Dollar-Free Grain Trade Within BRICS

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from Sputnik News:

Expanded BRICS, a club of major developing economies, could become a platform for a self-sufficient dollar-free grain market, economists say.
BRICS – an acronym for Brazil, Russia, India, China, and South Africa – added net grain importers Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates (UAE) in 2024, almost equalizing the production and consumption of key grain crops within the group.

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Under these circumstances, the association may create its own trading platform and trade grain within the group without using the US dollar, reads a letter from the Russian Union of Grain Exporters (Rusgrain Union) to the Ministry of Agriculture, reviewed by Russian business newspaper Vedomosti.

According to Rusgrain Union estimates, the five BRICS countries at the end of 2023 produced a total of 1.17 billion tons of grain per year (42% of world production) and consumed 1.1 billion tons (40% of world consumption). After the expansion, the group’s grain production will mount to 1.23 billion tons per year (44% of the world), and consumption will come close to production, i.e. 1.22 billion tons (also 44%).

“Statistically, it is true that 25% of the wheat trade is Russian wheat,” Vladimir Petrichenko, CEO of the analytical company ProZerno, told Sputnik. “Likewise, more than 25% of the corn trade is Brazilian corn. Moreover, if we talk about soybeans, then about 58% of world trade is Brazilian soybeans. At the same time, China is the largest buyer of corn and wheat, Egypt is the largest buyer of wheat, although to a lesser extent; but they buy wheat in the same way as China there, 12 million tons per year. Now Saudi Arabia has been added, the main buyer of barley. But still, the key commodities are wheat, corn and soybeans. And for all of them, especially considering those who joined in January, this is a huge market.”

BRICS countries represent a huge part, and in some cases more than half of the market for these agricultural goods, the expert pointed out. “In short, this fruit is ripe to be picked up,” Petrichenko stressed.

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