The past year has been challenging in many ways: from the coronavirus pandemic to the drought that led to crop failure in the southern regions of the country.
However, many important records were achieved in 2020. Let’s list the main ones.
1. Record high grain harvest in Russia
In 2020, 133 million tons of grain were harvested, of which 85 million tons of wheat. These are record results after 2017 (135.5 million tons).
The Central and Volga Federal Districts showed particularly good results: the grain harvest increased by 35% compared to the 2019-2020 season and amounted to 23 million tons and 19 million tons, respectively.
2. Record high grain prices
Last year, the cost of a ton of wheat reached the maximum level of 17-19 thousand rubles per ton. This allowed producers and exporters to make good profits, but it became a big problem for processing enterprises: millers, bakers, as well as for the livestock complex.
Against this background, the government in record time (only 1 week) prepared and adopted a law on the introduction of export duties as early as February 2021. A quota system has also been developed that serves the same purpose: to prevent an increase in grain prices on the domestic market.
3. Record export
During the year, before the introduction of export quotas, Russian exporters managed to sell abroad up to 31 million tons of grain, including 25.5 million tons of wheat. In the second half of the year, another 25 million tons of wheat were exported. As a result, in terms of exports, 2020 also exceeded the results of last year by almost 2%.
4. The worst harvest year in the North Caucasus Federal District
Only 5 million tons of wheat were harvested in the North Caucasian District. This is a quarter less than in 2019. The main reason is the dry summer, as well as late frosts and locusts.
5. Record purchases of Russian grain by Egypt and Turkey
Egypt is the first in the list of buyers, and Turkey is the second. In the second half of 2020, more than 5.5 million tons of wheat were shipped to Egypt from Russia (one and a half times more than a year ago). Turkey bought 5 million tons.
It is noteworthy that this year Turkey has completely abolished the import duty on oilseeds, including sunflower and rapeseed. This became one of the reasons for the sharp rise in prices for oilseeds within the Russian Federation, the desire of exporters to sell as much as possible to Turkey, and the reluctance of producers to supply these products to the domestic Russian market. This, in turn, led to the establishment by the government of the Russian Federation of the maximum price for vegetable oil (no more than 110 rubles in retail).
Overall, 2020 was a year of a significant increase in world grain prices, as many countries decided to make strategic stocks amid the alarming situation with the coronavirus. It is likely that in the coming year the grain will keep at the same high price level.
(Analytics based on Export Data application)
