Russia has 1M tons of wheat to export

Traders are not agreeing to new deals, but are trying to fulfill contracts signed before export curbs were imposed

Russian grain exporters still have 1 million tons of wheat to export under contracts signed before the government imposed curbs on exports, according to a report.

The head of the Grain Union, Arkady Alochevsky, said traders are trying to fulfill previously signed contracts, but are not agreeing to any new deals.

“The risks are so unpredictable now that exporters are afraid to sign contracts,” he said. “When you sign a contract now you cannot guarantee that you will be allowed to ship this volume out of the country.”

The Russian government has been trying to keep domestic wheat prices lower, but they have risen recently due to a falling ruble. Prices for third-class wheat increased by RUB50 (80 cents) per ton last week, according to SovEcon, a company that reports on Russian agriculture.

The government imposed an export tax from February 1 until at least June 30. The duty is set at 15 percent of the customs price plus EUR7.5 (US$8.5) but will be no less than EUR35 per ton.

Exporters had contracts to ship 3 million tons of wheat in December. They were able to ship 2 million tons in January, and 87,000 tons in the first 11 days of February, according to reports.

“Some companies will have to continue supplying wheat for exports and fulfill previously agreed contracts despite the launched tax and signs of the ruble stabilization,” SovEcon said.

The largest importers of Russian wheat are Turkey, Egypt and Iran.