July 3 2003, 09:40 UNIAN

Government will import 2-3 mln t of grain - Tyhypko

Head of the National Bank of Ukraine Serhiy Tyhypko said on July 2 that the government was about to import 2 to 3 million tonnes of grain, for which the sum of $500 to 600 million would be required. He said that such a sum was available and the country's banking system was able to provide it. He said that in such a way it would be possible to reduce the prices for grain and flour. Besides that, he said, the government was ready to perform intervention in the markets of sugar and groats, to extinguish the rush demand arisen in the last two weeks.

As a whole, he said, the inflation pressure, resulting from the leap of prices for food products, can be localised by government's interventions, which would allow fitting into the earlier forecasted rate of inflation for this year.

The government earlier suggested that in the summer months there would be registered deflation in Ukraine, however, the rush demand for groats and some other foodstuffs, arisen in two recent weeks, has entailed considerable growth of the prices.

According to the Ministry of Economy, from May 20 till June 23 the retail prices for bread produced from top grade flour increased 0.6 percent on average; for bread, produced from mixed flour - 1 percent. In some regions bread prices increased 12 to 13 percent.

Retail prices for top grade flour increased 11.9 percent. The price growth was observed in 22 regions out of 27. Besides that, a considerable increase of prices for buckwheat groats and sugar has been registered.

Inflation in Ukraine in the first five months of 2003 constituted 4.5 percent. The government earlier forecasted the rate of inflation for this year to be at the level of 6 to 8 percent.