Experts anticipate that Russia’s grain export quota for the 2024/25 season, effective from February to June, could be reduced to nearly one-third of the 29 million tons allowed in the previous year. This decrease is attributed to high export rates in recent months and a poorer-than-expected harvest.
Export Quota Overview:
Russia permits grain exports quota-free from July to January, after which it imposes quotas on approximately 260 domestic traders authorized to sell grain internationally.
The IKAR consultancy predicts export quotas for the second half of the 2024/25 season will range between 11.5 and 12.0 million tons.
Other forecasts include 10 million tons from Andrei Sizov of SovEcon consultancy and 9-10 million tons from Igor Pavensky of Rusagrotrans, considering current export rates and future projections.
Market Dynamics:
Market participants expect the official quota size to be announced in January, with the overall export potential for the new season estimated at 55-57 million tons.
Despite a lower harvest due to adverse weather conditions and declining global prices, Russian firms have been exporting grain at near-record levels. New export terms introduced in October and a return to minimum export price recommendations by the Ministry of Agriculture have contributed to this surge.
Current Export Status:
As of November 1, Arkady Zlochevsky, head of the Russian Grain Union, estimated Russian grain exports this season at 25.1 million tons.
Russia implemented export quotas in 2020 to safeguard the domestic market, and since 2021, these quotas have only applied during the second half of the export season, from February 15 to June 30.
Quota Utilization:
At the start of 2024, the original quota was set at 24 million tons, later increased by 5 million tons due to record exports from the previous season, estimated at no less than 72 million tons. However, only 76% of this quota was utilized, leading to penalties for traders who did not meet their quotas, according to Agriculture Minister Oksana Lut.