Prices for Russian wheat remain stable despite the growth in the global market: analysts predict an increase in prices.

Last week, the prices for Russian wheat exports remained virtually unchanged. According to the Institute for Agricultural Market Studies (IKAR), the price for new crop wheat with delivery in October was $216 per ton (up $1). The analytical company SovEcon reported prices in the range of $217-220 per ton. As per ProZerno's monitoring, on September 13, the price for Russian wheat in Novorossiysk was $218 per ton, with minor changes over the past four weeks. Some market operators mentioned prices in the range of $216-217 per ton.

At the same time, the global market showed an average increase of 15% within a month. The most significant growth was observed in American SRW wheat, which rose by 23% to $259 per ton, and in French wheat, which increased by 12% to $250 per ton. The price of wheat from the Black Sea region also rose by 3% to $227 per ton, and the price of Romanian and Bulgarian wheat also increased by 3% to $230 per ton. In connection with this, the general director of ProZerno, Vladimir Petrichenko, believes that the price of Russian wheat should also increase. He stated: "The spread (price difference with competing countries) is so large that even the worst sellers have to raise prices by at least $5."

 

According to SovEcon, the volume of wheat exports from Russia in September will range from 4.7 to 5 million tons, slightly below last year's level (4.9 million tons). According to ProZerno, as of now, 3.1 million tons of grain and legume products have already been shipped, of which 2.9 million tons are wheat. Overall, exports of grain and legume products totaling 5.5 million tons are expected in September, of which 5.2 million tons are wheat.

Independent grain market expert Alexander Korbut notes that Russian wheat is currently stable and priced between $216 and $218 per ton (FOB Novorossiysk), making it more competitive compared to the rising French wheat. However, Korbut points out that there is not a significant demand for cheap Russian wheat. He says: "...there is a good grain harvest in the world, and the decrease in yields in Russia, France, and Ukraine does not raise serious concerns." However, over time, wheat deliveries will decrease, which may lead to price increases. Korbut also believes that the government should make efforts, as low wheat prices do not favor export support and development policies.

Senior analyst at the Price Indices Center, Ekaterina Zakharova predicts that next year the demand for wheat will increase, leading to higher prices compared to 2024. This will be due to not only a reduction in the harvest in Russia but also in the EU. However, Zakharova does not rule out the possible appearance of other factors that could affect prices. She says: "There could be some 'black swan' events. And much will depend on importers' ability to withstand price increases. Currently, the declining supply is a factor driving wheat market price increases." According to her presentation, at the end of 2023, the price was $258 per ton, which is $96 lower than the previous year. The main reason for the decrease is the high supply in the market.