Shortage to push Russian wheat prices higher: RusAgroTrans

A growing shortage of high quality milling wheat and consistent demand will push Russian wheat prices higher, Russian logistics operator RusAgroTrans said in a report Tuesday.

Export prices of Russian wheat for March delivery increased from $197/mt to $204/mt FOB over the first half of the month, with prices expected to increase further still to $205-$207/mt.

The Agricensus spot assessment for Russian 12.5% protein milling wheat is currently $204.25/mt – up almost 3.5% over the course of February.

RusAgroTrans raised its forecast for February exports to 3.5 million-3.7 million mt – up from its previous estimate of 3.1 million mt – citing the number of cargoes pushed back from January due to weather-related delays.

Russia has exported 1.89 million mt of grain over the first half of February, more than double the volume it exported at the same stage last year, RusAgroTrans said in the report.

The main exporters over the first half of the month were Aston (16.7% of the share), Glencore (13.5%), Linter (5.9%), and Louis Dreyfus (4.9%).

Egypt (23.4%) was the biggest buyer of Russian grains over the same period, followed by Turkey (19.3%), Vietnam (9%), Bangladesh (8%), Morocco (7.8%), and Iran (4.1%).

Separately, the ministry of agriculture announced that 656,000 mt of grain has been transported by rail under the government-backed freight subsidy as of Tuesday.

The scheme sees the state rail operator reimbursed for providing grain sellers with subsidised rail transportation, a plan intended to get crops from remote parts of Russia to ports where it can be exported.