After the introduction of the mechanism of floating duties on June 2, they managed to grow significantly, but then, as manufacturers and exporters hope, they will begin to decline.
On June 2, 2021, the floating duty on wheat was $ 28.1 per ton. Within a month, it increased by $ 13.2 and will amount to $ 41.3 on June 30.
As for other crops, the duty on them changed insignificantly: for corn it decreased from $ 52.2 to $ 50.5 (currently $ 50.2), for barley it did not change and is $ 39.6 per ton.
The floating duty adjustment mechanism is based on a comparison of current world prices with reference prices. The greater the difference, the greater the duty will be.
In the period from June 23 to June 29, the wheat duty is kept at $ 38.1. But already in 2 days another increase of more than $ 3 per ton is coming.
Are high duty rates hindering active exports?
As the director of the analytical department of the Russian Grain Union Elena Tyurina noted, on the eve of the start of a new agricultural year (from July 1), Russia could export the remnants of the last harvest, but it is unlikely to do this, because the current situation with the size of export duty rates prevents this.
Also puzzling is the fact that export duties are growing against the background of a general decline in prices for agricultural products on world markets.
According to Tyurina, this may have adverse consequences, as it will reduce the competitiveness of Russian manufacturers and exporters.
At the same time, Eduard Zernin, Chairman of the Board of the Union of Grain Exporters, believes that the pace of June exports has nothing to do with the current duty rates, because all exports this month are just the fulfillment of previously concluded contracts.
After the new grain harvest in Russia, it may become cheaper
According to a number of experts, in the new season, three factors will contribute to a decrease in grain prices on the domestic Russian market:
Fall in world prices.
High level of export bids.
Good harvest for the new season.
The first two factors together make the sale of grain for export unprofitable, so that producers will not seek to sell it on foreign markets.
As for the new grain harvest, it is forecasted at the level of 126-132 million tons, up to 85 million tons — wheat.
Thus, the actual size of the new crop is the factor that will be able to influence the domestic Russian prices to the maximum extent.
And if the weather conditions of the remaining weeks do not lead to the death of a significant part of the harvest, then one can hope that domestic grain prices at least will not rise.
