According to analysts, wheat has risen significantly in price in recent days to last year’s levels.
For almost the entire year of 2024, wheat prices were falling, which was a strong negative for both agricultural producers and exporters. However, in recent weeks, the trend has changed and growth is now being recorded.
For example, last week, Russian wheat with protein rose in price by $4 and is now trading at about $242 per ton. The same is true for American wheat.
At the same time, French and Romanian wheat cost $246, which allows Russian wheat to remain highly competitive.
However, Argentine wheat is currently trading even cheaper, at $231 per ton.
According to experts, there are several reasons for the cost of wheat on the world market to begin to rise.
Firstly, in January, supplies from Russia significantly decreased, and there is every reason to believe that this trend will continue in February. And since the Russian Federation is one of the main suppliers of wheat to the world market, the reduction in supply volumes directly affects world prices.
The Ministry of Agriculture is confident that this season the country will retain its leadership in this area.
“We have already exported about 30 million tons of wheat this season. This is more than any of our competitors will be able to export in a season,” notes Deputy Minister of Agriculture Maxim Titov.
Secondly, the potential for supplies from Eastern European countries is also currently almost exhausted.
This also contributes to a decrease in supply on the world market while maintaining demand, which also contributes to price growth.
In general, at the moment, the rate of wheat exports from Russia is at a fairly low level.
It is expected that January exports will be at a level of about 2.5 million tons. This is significantly less than in January last year, when this figure was 4 million tons.
In February, experts expect shipments of about 2.2 million tons, which is half as much as a year earlier (4.4 million tons) and overall the worst figure since 2020, when only 1.9 million tons were shipped.
In total, about 42 million tons of wheat and 48 million tons of grain in total can be exported during the season that has begun.
The decrease is partly due to the fact that last year farmers did not have the largest harvest.
If wheat prices strengthen and this year’s harvest is larger than last year, this could lead to an increase in the figures and will generally be positive for the market.
