Russia's wheat exports likely to fall sharply in March

12-Mar-2025 06:17 PM

Russia's wheat exports likely to fall sharply in March

Moscow: A leading trade analyst firm has forecast that Russia’s wheat exports will decline significantly in March 2025, falling to 14-18 lakh tonnes. This marks a sharp drop of nearly 67% from March 2024’s record exports of 48 lakh tonnes and is 40-50% lower than the five-year average of 33 lakh tonnes.

Key Factors Behind the Decline in Russian Wheat Exports:

1. Negative Margins for Exporters:

   • In November 2024, Russian wheat exporters enjoyed a $10 per tonne profit on shipments.
   • Currently, margins have turned negative, making exports financially unviable.

2. Rising Domestic Wheat Prices:

   • Wheat with 12.5% protein is being bid at 17,500-18,000 rubles per tonne at deep-sea ports.
   • Exporters are pressuring producers to lower prices, but farmers are holding back sales, expecting higher prices in the future.

3. Low Domestic Wheat Stock:

   • As of February 1, 2025, major wheat producers in Russia had only 137 lakh tonnes of wheat stock, which is:
     • 32% lower than the February 2024 stock.
     • 7% lower than the five-year average.

4. Falling Global Competitiveness:

   • Russian wheat is facing stiff competition from other exporting countries.
   • The Free on Board (FOB) price for 12.5% protein wheat has fallen by $2, now ranging between $246-$250 per tonne.
   • This is the first price decline since January 2025.

Projected Wheat Exports for 2024-25 Marketing Season:

• Analyst Firm Estimate: 42.2 million tonnes.
• USDA Estimate: 45.5 million tonnes.

Market Outlook:

• Russian farmers are reluctant to sell at current price levels, expecting further price hikes.
• Export volumes may remain low unless price margins improve.
• The ongoing supply-demand dynamics could impact global wheat prices in the coming months.