Increasing Export Taxes, Decreasing Wheat Production Hitting Russia

MOSCOW, RUSSIA – Last week, the United States exported over 500,000 metric tons of wheat primarily to the Philippines, Peru, and South Korea and so far this season has been relegated to selling to buyers in the Pacific region and the Americas. Things may be changing soon though.

According to the Russian Ministry of Agriculture, wheat exports are down 12 percent from last year due to rising taxes.

S&P Global Platts had already reduced the estimate for Russian exports because the government increased the wheat export tax to compensate for the “rapid growth” in wheat prices back in August.

The publication explains that the tax, or duty, is applied whenever the market price of wheat hits 70 percent of a benchmark price set internally by the government.

There seems to be some concern from the Ag Department that dry weather conditions may reduce production this coming season.
(SOURCE: All Ag News)