Russian domestic wheat prices down sharply as export tax looms

MOSCOW – DECEMBER 15, 2020

Russian domestic prices for wheat fell sharply at the end of last week as supply rose ahead of a wheat export tax which Russian officials are planning to impose in addition to a grain export quota, analysts said on Monday.

Russia plans to impose a set of measures to slow the rise of domestic food prices, including the wheat export tax of 25 euros ($30.4) for Feb 15-June 30, its government said at a meeting on Monday.

“Grain supply is up as farmers are rushing to sell at current still almost record-high prices after export tax rumours,” Soviet agriculture consultancy said in a note.

Domestic prices for third-class wheat fell by 225 roubles to 15,725 roubles ($215.4) per tonne last week, it added.

Russian wheat with 12.5% protein loading from Black Sea ports for supply in December was at $252 a tonne on a free-on-board (FOB) basis at the end of last week, unchanged from the week before, another agriculture consultancy, said in a note.

Soviet Ag said wheat export prices rose by $2 to $257 a tonne, while barley was steady at $216 a tonne.

Domestic sugar prices were slightly down in rouble terms, but rose by $4 in dollar terms due to stronger rouble, IKAR said.

Other Russian data provided by Sovecon and IKAR:

 Product:            Price at the end       Change from week
                        of last week:                earlier
 - Domestic 3rd         15,725 rbls/t              -225 rbls
 class wheat,                          
 European part of                      
 Russia, excludes                      
 delivery                              
 (Soviet Ag)                             
 - Sunflower seeds      39,325 rbls/t              -575 rbls
 (Soviet Ag)                             
 - Domestic             89,350 rbls/t              +850 rbls
 sunflower oil                         
 (Soviet Ag)                             
 - export                    $1,090/t                   -$10
 sunflower oil                         
 (Soviet Ag)                             
 - export                    $1,105/t                   +$10
 sunflower oil                         
 (Russian Ag)                                
 - Soybeans             40,700 rbls/t              unchanged
 (Soviet Agn)                             
 - white sugar,              $542.7/t                    +$4
 Russia's south                        
 (Russian Ag)                                
 ($1 = 73.0075 roubles)

Source: Reuters