As of January 2025, the price of fourth-class wheat (12.5% protein) in Russia’s domestic market rose from 14,725 rubles per ton to 15,525 rubles per ton, according to monitoring by the analytical center “SovEcon.” The most substantial increase was observed in the southern region, a key export area, where prices escalated by 900 rubles, reaching 16,350 rubles per ton.
Several factors have contributed to this upward trend:
- Exporter Demand and Global Market Prices: Exporters have been actively purchasing wheat, supported by higher global market prices. For instance, wheat prices on the French MATIF exchange increased by 2.5 euros ($3) week-on-week as of January 29, reaching 233 euros per ton ($242/ton). Consequently, Russian wheat with 12.5% protein content saw a price increase of $1.5, reaching $237-239 per ton FOB.
- Active Exporter Purchases: In recent months, exporters have been actively buying wheat. In December, Russian agricultural producers sold 4.8 million tons of wheat, up from 4.3 million tons in November. This increase was primarily due to high sales in the southern regions.
- Anticipation of Price Increases: Active purchases amid relatively low export levels may indicate that exporters are stockpiling grain in anticipation of price increases or a revival in shipments. “SovEcon” forecasts Russian wheat exports in the 2024/25 year at 42.8 million tons, compared to the U.S. Department of Agriculture’s estimate of 46 million tons. Rising domestic prices and a strengthening ruble could stabilize or further increase Russian wheat prices, thereby supporting the global market.
The recent surge in Russian wheat prices is primarily driven by increased exporter demand, higher global market prices, and strategic stockpiling in anticipation of future price hikes. For stakeholders in the agricultural sector, understanding these dynamics is crucial for making informed decisions in a rapidly evolving market environment.
Error
