Russian authorities announced on Wednesday that the export duty on wheat would be temporarily scrapped. This is an additional anti-crisis measure, following last week’s announcement of subsidies for rail shipments of grain to Baltic ports. Farmers say that their inability to sell grain as domestic prices fall threatens to derail the winter-crop sowing campaign, as farms will be unable to repay existing loans or secure new financing for the autumn sowing season. They consider large-scale government grain purchases for state reserves, as well as an announcement on the extension of all existing loans, to be the most appropriate anti-crisis measures. The volume of subsidised loans, they say, is but a drop in the ocean.
Russian farmers are unable to sell wheat that has become effectively illiquid, with prices falling by RUB 100–200 per tonne every day, as grain shipments through Black Sea ports have almost come to a halt.
Russian wheat exports in September are expected to total about 2 mln tonnes, compared with 4.6 mln tonnes a year earlier, according to a new report by SovEcon. During the first three months of the 2026/27 agricultural season, Russia may export about 5.6 mln tonnes of wheat, compared with 11.3 mln tonnes in July–September last year.
‘Strikes on port infrastructure in the Black Sea are continuing, and there are no clear signs of de-escalation yet. Presidents Recep Tayyip Erdogan and Vladimir Putin met on September 1, but there were no public statements following the meeting on Black Sea shipping or grain exports. Putin’s subsequent statements made clear that Moscow is not prepared to return to the Black Sea grain deal under current conditions,’ SovEcon said in its latest report. Experts note that some alternative routes for agricultural exports are gradually increasing their freight volumes, including Russian Baltic Sea ports and terminals in Latvia and Lithuania. SovEcon expects up to 0.5 mln tonnes a month to pass through these routes, less than 10% of the volumes normally handled by Russia’s southern ports.
‘In the coming weeks, we do not expect the situation in the Sea of Azov and Black Sea basin to normalise, although shipments may partially recover later in the autumn. Extremely low Russian export volumes, combined with weak Ukrainian exports, are expected to support global grain prices while simultaneously increasing pressure on the domestic market,’ the experts say.
The main threat now is the risk of the autumn sowing campaign being disrupted, warns Arkady Zlochevsky, president of the Russian Grain Union. Even a small delay in farmers receiving funds could cause major losses, as sowing in November–December will no longer be possible.
The area planted with crops across farms of all categories fell by almost 3% last year. Wheat plantings, in particular, declined by 4.5%. The country now faces the prospect of an even sharper reduction in the area planted with grain crops.
‘Russian farmers have traditionally repaid their loans after the first sales of the new harvest. But grain sales are now falling. Without repaying old debts, it will be impossible to obtain new loans to conduct the autumn sowing campaign,’ Zlochevsky explains. Without new financing, he says, many farms simply will not be able to carry out the sowing campaign. ‘The main task now is to ensure that farmers receive the money needed to sow winter crops. To achieve this, all loans to farmers need to be urgently extended, not just subsidised loans, whose share is a drop in the ocean,’ says the head of the Russian Grain Union. In his view, the measures proposed and implemented by the government are failing to resolve the ‘difficult situation’.
Russian authorities are reducing grain export duties to zero until the end of the year. The decision was taken by the sub-commission on customs and tariff and non-tariff regulation and foreign-trade safeguard measures. ‘Given the need to restructure logistics, the initiative of the Ministry of Economic Development and the Ministry of Agriculture to suspend the operation of the damping mechanism, which provides for a floating duty on grain exports, has been supported. The duty rate is planned to be reduced to zero until December 31, 2026,’ the ministries said. ‘Regarding the damping mechanism for sunflower oil and sunflower meal, the decision was supported not to raise the floating export duty above the August 2026 level.’ A corresponding draft government resolution will be submitted for consideration shortly
Last week, Prime Minister Mikhail Mishustin signed an order providing more than RUB 9.7 bln in subsidies for agricultural rail shipments at preferential rates.
Farmers are likely to welcome the abolition of floating wheat export duties. ‘Producers have called for the abolition of export duties ever since they were first introduced. When introducing floating wheat export duties, the Russian authorities cited Argentina’s experience. But Argentina is now gradually abandoning this regulatory mechanism, which has proved highly unsuccessful. Unfortunately, Russia adopted the least successful example of grain-export regulation,’ the Grain Union says.
Russia introduced the grain damping mechanism on June 2, 2021. It provides for floating export duties on wheat, maize and barley, with part of the proceeds returned to subsidise agricultural producers. The duties are calculated weekly using indicators based on export-contract prices registered on the Moscow Exchange. The duty is set at 70% of the difference between the base and indicative prices. In August 2024, the floating duties were extended for two years, until August 31, 2026. In October 2025, the government extended them until August 31, 2028.
‘The reduction of the export duty to zero creates more predictable operating conditions for the industry during the restructuring of export logistics,’ said Maxim Borovoy, Deputy Agriculture Minister. ‘We expect the temporary adjustment of export duties to reduce costs for market participants, support the economics of production and ensure stable supplies of Russian agricultural products,’ the official said.
The dynamics of domestic grain prices could become an objective indicator of whether the government’s anti-crisis measures are succeeding or failing. If prices stop falling, this could be seen as the beginning of an exit from the grain-export crisis.
ORIGINAL: NG/Difficulties Exporting Grain Threaten to Derail the Autumn Sowing Campaign
