Russian Grain Exports Halted Amid Black Sea Disruptions

Russian farmers and market analysts are skeptical about the government's measures to maintain grain exports, despite ongoing disruptions in the Black Sea region.

The country's largest wheat exporter, Russia, has seen its grain exports through the Black Sea halted due to tit-for-tat attacks with Ukraine. This has raised concerns among major customers, especially in the Middle East, over supplies, while leaving a surplus in the Russian domestic market, driving down prices.

In response, the government wants to reroute some exports, scrap a grain export duty until the end of the year, buy grain for state stocks, grant railroad transport subsidies and loan extensions to producers, and use excess grain as livestock feed. However, analysts say these measures are unlikely to significantly support Russian grain exports or domestic prices.

Sovecon's Andrey Sizov said that subsidies and state interventions will not change the supply and demand balance, and called for a permanent rather than temporary abolition of the export duty, which has been a major irritant for Russian farmers since its introduction in 2021.