Russian wheat supplies have reached record highs, with export prices falling to their lowest levels in the last three years. As Bloomberg writes, citing sources, against this background, the Russian authorities are discussing the introduction of a minimum price for wheat, refusing to issue export documents for deliveries at a lower cost.
According to analysts of the agency, Russian wheat does not have many competitors in wheat supplies, while large stocks and “unprecedented harvest” lead to “oversupply”, due to which prices are falling.
According to Bloomberg sources, the Russian authorities’ intention to set a minimum price for supplies is forcing some traders to renegotiate terms or cancel deals. The Union of Grain Exporters told Bloomberg that they stick to prices dictated by “increased production costs”.
According to the U.S. Department of Agriculture forecast, global wheat supplies in 2023-2024 will decline by 3 million tons to 793 million tons due to lower production in Canada and Europe. As reported in Argitel, Russia’s share in the global trade is 23% with production of 87.5 million tons, which is significantly higher than the average for the last five years.
Source: Kommersant