Russian wheat export prices continued to climb last week as traders prepared for upcoming export quotas set to take effect on February 15. Analysts noted a decrease in exports and a consolidation among exporters, contributing to the rising prices.
Key Highlights:
Current Pricing:
The price of Russian wheat with 12.5% protein for free-on-board (FOB) delivery in March rose by $2 to $245 per metric ton, according to Dmitry Rylko, head of IKAR consultancy.
The Sovecon consultancy reported similar prices for Russian wheat in the range of $241 to $245 per ton, up from $237 to $239 the previous week.
Export Quotas:
The Russian government permits unrestricted exports from July to February, but imposes quotas starting in mid-February. This year, the quotas have been reduced by 63% to 10.6 million metric tons.
Analysts suggest that exporters are increasing demand to secure grain before the quotas take effect.
Export Volume:
Weekly grain exports were estimated at 0.64 million tons, including 0.58 million tons of wheat, down from 0.66 million tons the prior week.
February wheat exports are projected between 1.8 to 2.2 million tons, a significant drop from 4.1 million tons a year earlier.
Production Forecasts:
IKAR has revised its 2024/25 wheat export forecast down to 43 million metric tons from 43.5 million tons, citing low stocks and margins.
For the 2025/2026 season, Sovecon raised its export forecast to 38.3 million tons from 36.4 million tons.
Impact of Weather:
IKAR has also adjusted its 2025 wheat production estimates down to 82 million tons due to concerns over freezing temperatures and insufficient snowfall.
Sovecon analysts noted a potential cold snap in mid-February but indicated that the risk of winterkill is limited due to accumulating snow cover.