Russia has increased its wheat export tax by 41% to 1,872 rubles ($333) per metric ton, effective October 16, 2024. This decision follows a private meeting between the Agriculture Ministry and major exporters to address this year’s sales.
The tax hike is in response to higher prices for Russian wheat in recent tenders, with bids ranging from $230 to $243 FOB. The aim is to limit sales to other countries as exports have reportedly exceeded reasonable levels.
The influential grain exporters union plans to request a review of the quota distribution system for the second half of the season. Currently, export quotas are allocated from February 15 to June 30.
Despite concerns over the tax increase impacting the market, the Agriculture Ministry has not yet assigned export quotas for the current season. Russia, the largest wheat exporter globally, has adjusted its official harvest estimate to 130 million tons amidst challenging weather conditions in grain-producing regions.
Russia Hikes Wheat Export Tax by 41% Amid Closed-Door Talks with Exporters
The government aims to reduce wheat exports to stabilize domestic bread prices amid inflation of around 9%. Expectations of a further interest rate increase from the central bank, currently at 19%, coincide with lower grain harvest estimates.
Russian farmers have harvested 122 million tons of grain, meeting domestic needs estimated at 85-87 million tons, with the surplus available for export.