Russia floating wheat export tax falls as quota period approaches
Russia’s wheat exported from Jan. 21 to Feb. 1 will be taxed at $95.80/mt, as the country’s floating export duty fell by $1.70/mt from the previous week, the country’s agriculture ministry said Jan. 21.
The export duty has fallen in the last two weeks, having reached a peak of $98.20/mt for wheat shipped between Jan. 12 and Jan. 18. Until then, it had risen every week between Sept. 22 and Jan. 11.
From Feb. 15 to the end of the marketing year on June 30, an additional constraint on exporters will come from the government’s wheat export quota, which was announced in December at 8 million mt.
That was a significant reduction from the quota for the same period of 2021, when it was set at 17.5 million mt, although it covered all grains and had no separate allocation for wheat. The period prior to its implementation saw exporters rushing to ship cargoes with prices declining by 6% in the three weeks to mid-February, having hit a multiyear high on Jan. 22, 2021.
S&P Global Platts assessed FOB Black Sea wheat (Russian Deep Sea, 12.5% protein) at $330/mt on Jan. 21, $1 higher than on Jan. 14 when the export tax was announced for the previous week.
The variable export tax was introduced in Russia on June 2, 2021, having been set a fixed level from the previous three months, as the government sought to limit domestic grain price rises.
The export tax is calculated as 70% of the difference between the average of export prices on an FOB basis during the 60 days preceding the day of calculation and $200. It is published each Friday and enters into force on Wednesday of the following week.
The US Department of Agriculture expects Russia to export 35 million mt of wheat in the 2021-22 marketing year (July-June), and Russian Federal Service for Veterinary and Phytosanitary Surveillance said the country had exported 22.7 million mt, up to Jan. 13.