SovEcon: December Russian wheat exports to drop YoY

The forecast was lowered due to weak current shipments.

SovEcon estimates December wheat exports at 3.8 million metric tons (MMT), down from 4.1 MMT a year earlier and an average of 3.5 MMT. The forecast was lowered due to weak current shipments.

Shipments from Russian ports in December have slowed compared to autumn. The wheat export volume totaled 2.0 MMT in the first three weeks of December, compared to 2.3 MMT in November and 2.7 MMT in October.

Sales of Russian wheat decreased towards the end of the month. The amount of outstanding sales of Russian wheat as of December 27 was 2.9 MMT, down from 3.3 MMT at the beginning of the month.

Shipments may likely be limited by attempts to regulate wheat prices by Russia’s Ministry of Agriculture (AgMin). At the last two tenders of Egypt’s GASC, Russian suppliers were unanimously offering wheat at $265/mt FOB (270-day payment delay). These offers likely comply with the “minimum recommended price” established by the AgMin, as reported by Russian media.

Stormy weather in the Black Sea over the past weekend may have additionally constrained exports.

In December, SovEcon lowered its Russian wheat export estimate in 2023/24 by 0.2 MMT to 48.6 MMT. The U.S. Department of Agriculture maintained its estimate at 50.0 MMT. Given the current market dynamics, the latter estimate begins to look overly optimistic.

Sluggish exports in the short term could support the global wheat market.

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