Russia’s two month wheat exports drop 27% to 5,9 million tonnes

In July-August 2022, Russia’s new crop wheat exports totaled 5.9 million tonnes, which is a 27-percent drop on July-August 2021, Reuters reported citing the SovEcon statistics. The agriproducts market specialist said this is the commodity exports record low since the 2017-2018 season.

SovEcon says Russian farmers will harvest a record 94.7 million tonnes of wheat this year.

The consulting company notes that exports remain at low levels, as Russian wheat prices are higher that from other suppliers, primarily from the EU. The company also believes that Russian exporters may face challenges in the commodity deliveries due to the worsening weather conditions in the Black Sea and the seasonal shutdown of inland shipping.

“Russian wheat exports may accelerate in the short term due to falling domestic prices and/or higher global wheat prices. We believe that the Russian domestic market is far from the bottom, while there is a high probability that the world market has already overcome it,” TASS agency quoted SovEcon as saying.

This year Russia can harvest, under favorable weather conditions, about 120 million tonnes of grain, according to the Russian Grain Union (RGU).

Meanwhile, wheat prices in the EU hit nearly EUR 440 / tonne mark in May.

Due to sanctions following military operation in Ukraine, Russian wheat exporters have faced problems in supplying wheat to the global market. First Deputy Prime Minister of the Russian Federation Andrey Belousov and UN Secretary General António Guterres signed a MoU on July 22 on Russian agri product exports. The main task is to ensure transparent and unhindered supplies of Russian food and fertilizers, including raw materials for their production, to world markets. It is, in particular, about how to eliminate the restrictions of sanctions for the export of grain and fertilizers in the areas of finance, insurance and logistics. The term of the memorandum is three years.