In a significant move to tackle inflation, Russia, the world’s largest wheat exporter, announced a drastic reduction of its wheat export quota for 2025 by two-thirds. The government also increased wheat-export duties and eliminated import quotas for certain staple foods.
Key Highlights:
Export Quota Reduction:
Russia’s export quota for the period from February 15 to June 30, 2025, will be 11 million metric tons, down from 29 million tons in the same timeframe this year.
This decision comes amid a high export pace and a disappointing harvest due to adverse weather conditions in key wheat-producing regions.
Increased Export Duties:
The Russian agriculture ministry announced an over 18% increase in wheat-export duties starting December 4.
Domestic Market Focus:
Deputy Prime Minister Dmitry Patrushev emphasized the need to prioritize domestic supply, stating, “We are strengthening control over the export of agricultural products to stabilize the price situation.”
The government is encouraging retailers to establish long-term contracts with producers of essential goods like potatoes and vegetables.
Food Import Strategy:
Russia aims to increase food imports from “friendly” countries and has introduced duty-free quotas for imports of potatoes, carrots, apples, and butter.
Inflation Concerns:
With inflation currently at 8.5%, the government is particularly concerned about rising prices for essential items. Official statistics show:
Butter prices have surged by 32% this year.
Potato prices have increased by nearly 80%.
Bread prices have climbed 13%.
Impact on Wheat Buyers:
The new measures will affect major wheat importers such as Egypt, Iran, Turkey, Algeria, and Saudi Arabia. Analysts believe the export-quota cut is essential for stabilizing consumer prices and ensuring food security.
Future Projections:
The Russian Grain Exporters and Producers Union anticipates wheat exports for the 2024/2025 season to be between 47 million to 52 million tons, which should maintain Russia’s position as the top wheat exporter.