New Delhi — The Russian government on Friday proposed a quota of 7 million mt for export of grains, comprising wheat, corn, barley and rye, for April to-June in order to stabilize the domestic market.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
The government did not give the division for the quota for different grains.
The proposal of grain export quota from the world's largest wheat exporter comes in the wake of the coronavirus pandemic disrupting food supply chains around the world.
"As an immediate effect, the decision may lead to higher FOB prices [export prices on free on board basis] for wheat as Russia is one of the main suppliers," said Victoria Sinitsyna, grains analyst with Platts Analytics.
A similar view was given by Elena Neroba, market analyst at Maxigrain. "Though 7 million mt for grains for April-June is along expected lines, prices could still rise on hysteria," she said.
Data from the Russian Federal Service for Veterinary and Phytosanitary Surveillance shows in the marketing year started July, Russia has exported 27.4 million mt of wheat as of March 17, against the estimate of 35 million mt for 2019-20 given by the US Department of Agriculture.
Platts Analytics estimates Russian wheat exports for 2019-20 at 34.2 million mt and that of corn at 5.4 million mt.
Corn exports from Russia from start of the marketing year and March 17 stood at 2.7 million mt.
The set of proposed measures will guarantee the necessary volume of grain in the domestic market, prevent a spike in prices for the main crops, as well as consumer prices for the final products of the flour, cereal, baking and meat and dairy industries, said Agriculture Minister Dmitry Patrushev.