Lower supply and stronger rouble drive Russian wheat prices higher, as well as the concerns over state plans to build up sectoral regulation, Reuters reported on Monday.
Stronger controls on grain exports are being considered by Russia's state agriculture watchdog. The agriculture ministry also plans to regulate domestic grain prices through subsidies on rail transport from remote regions. Those plans created some rumors in the market, that Russia could limit grain exports in the 2018/19 season to keep a lid on domestic prices.
Black Sea prices for Russian wheat with 12.5 percent protein content and for delivery in February were $243 a tonne free on board (FOB) at the end of last week, up $5 from a week earlier, Russian agricultural consultancy IKAR said in a note. SovEcon, another Moscow-based consultancy, quoted FOB wheat up $2 at $240.5 a tonne and barley steady at $236 a tonne.
Prices in domestic market for third-class wheat were up 50 roubles to $174 per tonne at the end of last week in the European part of Russia on an ex-works basis. Ex-works supply does not include delivery costs. Sunflower seed prices rose by 200 roubles, sunflower oil prices were steady.
Russia exported 29.4 million tonnes of grain from the start of the season on July 1 to Jan. 10, that is 4.3 percent more year on year. Wheat export totaled 24.7 million tonnes (+12.8 percent).