Russia’s VTB Bank buys more grain trade infrastructure

Russian state bank VTB, which has been actively buying grain export infrastructure assets, bought a controlling stake in Russia’s largest grain rail-wagon owner Rustranscom. VTB is also planning to acquire a stake in major local grain trader Mirogroup, Reuters reports.

Russia’s second-biggest bank VTB said it was buying a controlling stake in Russian railway holding company RTC, a major transporter of grain and timber cargo. VTB said its acquisition of 50% plus one share in RTC, which manages a fleet of 68,000 freight cars, would link up its other grain export and trade logistics, making Russia’s supply chains more effective and globally competitive.
“Russia in recent years has significantly increased the volumes of wheat and other grains it produces and exports, and based on these indicators is in the top three globally,” VTB said in a statement.“This has taken on a strategic character for national agriculture and the economy of the country as a whole,” VTB said.
VTB is also preparing to buy a stake in major local grain trader Mirogroup, Reuters reports.
Mirogroup exported 2 million tonnes of grain in the previous marketing season, while some market players expect VTB to plan for a grain export program of 6 million tonnes in the new season, which starts on July 1, SovEcon said. This would bring VTB to the top of Russia’s grain trade league. The current leader, TD Rif, handles between 6 and 7 million tonnes of grain per season, SovEcon added.
In February, VTB surprised the market by buying its second grain terminal in the Black Sea port of Novorossiisk, giving it significantly more control over the main deep-sea grain export hub in Russia, which is the world’s largest wheat exporter. At the time, Yuri Soloviev, VTB’s first deputy chief executive told reporters that the state bank sees the possibility of working with the government to expand Russia’s grain export potential.
Russia is the world’s largest wheat exporter and the expansion of VTB, the country’s second-largest lender, in grain export infrastructure in recent months has been seen by some traders as a sign of the Russian government tightening the grip over the sector. The bank itself has said it sees the possibility of working with the government to expand Russia’s grain export potential. It currently owns stakes in two grain export terminals in the Black Sea port of Novorossiisk and has said it is in talks to buy a stake in another terminal in the Black Sea port of Taman.

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