Last week prices for Russian wheat with a protein content of 12.5 percent surged by $3 to $301 per ton (FOB deep-sea ports), Report informs referring to SovEkon website.
This is the highest level since April 2021. Prices have risen by more than $50 per ton since July, amid deteriorating crop prospects in Russia and Canada. An additional factor is a rise in domestic prices and the effect of poorly predictable export duty, experts say.
“Since June, the prospects for a new wheat crop in the Northern Hemisphere began to deteriorate rapidly. A significant part of the Russian crop was affected by dry and hot weather. An equally important factor was the reduction in winter crops, which became known only in July,” reads the message.
Prices for Russian wheat were also supported by the fact that since mid-July, the price of wheat in rubles has soared by about 3,000 rubles per ton. “An additional impact on export prices is exerted by the export duty, the amount of which is determined every week, despite that it is impossible to predict it exactly. Exporters include associated risks in the price,” experts say.
At the same time, they believe that a further rise in prices for Russian wheat is ‘in doubt.’
Prices for wheat from other regions have significantly decreased in recent weeks, and the competitiveness of Russian grain is falling. The domestic market will be under pressure amid the expected increase in export duties.