Andrey Sizov
21.08.2024
In the first two months of the new season, Russia is expected to export 8.2 million metric tons (MMT) of wheat, down from 9.8 MMT a year earlier, according to SovEcon. Russian wheat exports are anticipated to be lower YoY for the second consecutive month due to decreased exporter margins and relatively low demand for wheat.
As of August 20, the amount of outstanding sales of Russian wheat totaled 3.9 MMT, down from 5.8 MMT last year.
Export prices for Russian wheat are at a historically low level of $220/MT (FOB), compared to $252/MT a year earlier. Meanwhile, wheat prices in Russian ports are 16 400 rub/MT ($177/MT), compared to 16 550 rub/MT ($170/MT) last year. With such spread difference, exporter margins are only a few dollars compared to the double-digit margins of last year.
Wheat buyers have been cautious in recent months, waiting for lower prices. According to the European Commission, from July 1 to August 18, EU countries (excluding France) shipped 3.1 MMT of soft wheat, down from 3.6 MMT a year earlier.
Major buyers of Russian wheat are currently favoring suppliers from other countries. Last week, Egypt’s GASC purchased 0.28 MMT of wheat in a tender instead of the planned 3.80 MMT, with Ukraine and Bulgaria as the suppliers.
SovEcon estimates wheat exports for the 2024/25 season at 48.8 MMT, down from 52.4 MMT the previous year.
In the coming months, exports will lag behind last year’s pace, but are expected to seasonally accelerate later, as evidenced by increased purchases in the domestic market. Over the last month, wheat prices in Russian ports have risen by 1150 rub to 16 400 rub/MT ($177/MT).
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