Since the start of June, Russian 12.5% wheat bids in deep sea ports have climbed by 1800 rubles to 15,000 rubles per metric ton ($168/mt), as per SovEcon estimate. This is the highest bid since June 2022. The price rise has been bolstered by favorable global market conditions, reduced export taxes, and active competition among exporters.
Global market dynamics have been conducive to the increased Russian wheat bids. September French wheat at the MATIF exchange experienced a rise of €10 to €231/mt ($252/mt) in June, reaching a peak of €251/mt ($275/mt). Meanwhile, Russian FOB prices rose by $8 to $232.5/mt within the same period.
The drop in export wheat taxes in June, following the introduction of a new calculation formula, has further supported Russian wheat bids. By July 5, the export tax for Russian wheat had decreased to $29 from the initial $31 at the start of the month.
The competition among Russian exporters also played a role in price support. Since the start of June, the outstanding wheat export sales from large traders rose by 1.2 million metric tons (MMT) to 2.3 MMT.
High ruble bids in export terminals are likely to limit Russian exporters’ abilities to lower FOB prices.
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