Russia plans to increase agriculture exports after wheat sales dropped in July, according to government

Russia plans to increase agriculture exports after wheat sales dropped in July, according to government

In July 2025, Russia's Ministry of Agriculture announced significant changes to export duties on wheat and corn, applicable between July 9 and 15. This move follows a substantial drop in wheat sales, as reported by the government.

The Russian agricultural ministry set the wheat export duty at zero for this period, down from 56.3 rubles ($0.70) per ton. This is the first time the duty has been eliminated since its introduction in June 2021. The ministry aims to boost sluggish sales and counteract plummeting global grain prices [3].

The decision comes amidst a decline in wheat exports, with June 2025 exports at 1.12 million tons, a quarter of the level a year ago. The Russian Grain Union reported a 28% drop in wheat exports from July 2024 through June 2025, totaling 41.5 million tons [3].

The zero-duty period is part of a broader strategy to incentivize exporters to move unsold stocks quickly, leveraging the July 15 expiration of export quotas. The move is timed to coincide with global wheat prices near 18-month lows, due to bumper harvests in the U.S. and Australia. This creates an arbitrage window for traders, particularly in regions like North Africa and the Middle East, where supply crunches are evident [4].

The immediate beneficiaries of this policy shift are Russian grain exporters such as SNG Agro and Cherkizovo Group, which stand to gain from higher export volumes. These companies operate in a market where the government's support is clear, with the duty cut paired with implicit pressure to clear inventories [4].

Investors should prioritize firms with strong Black Sea logistics and access to Mediterranean ports, as these are critical to reaching target markets. Fertilizer producers like PhosAgro and EuroChem could also see sustained demand, given the 25% increase in input costs since 2021. However, caution is warranted, as imported fertilizers might become cheaper if the ruble strengthens [4].

The zero-duty period is expected to directly pressure global wheat prices, creating opportunities for traders to capitalize on the supply surge. Traders should consider short positions in CBOT wheat futures, particularly if Russian exports to Turkey and Egypt displace higher-cost alternatives. Monitoring the World Wheat Index (WWI) for signs of downward momentum is also advisable [4].

The window to capitalize on this shift is narrowing, with the duty cut in effect until July 15 and possibly extended. Investors who act promptly may benefit from the market absorption capacity tested during this period.

References:
[1] https://globaltradealert.org/state-act/92555-russia-changes-to-export-duties-on-certain-agricultural-products-9-to-15-july-2025
[2] https://www.reuters.com/world/china/us-owned-company-seized-feed-russia-planning-supply-china-north-korea-instead-2025-07-10/
[3] https://www.bloomberg.com/news/articles/2025-07-05/russia-drops-wheat-export-duty-to-zero-in-bid-to-boost-sales
[4] https://www.ainvest.com/news/wheat-shift-russia-export-duty-cut-reshapes-global-grain-markets-2507/