Russia grain market faces crisis as wheat prices drop

Russian grain producers are facing a sharp decline in prices due to export difficulties and rising domestic supply. In some regions, such as the Voronezh Oblast, wheat prices have fallen to approximately 6,000 rubles per ton (about 62 euros or 270 PLN), which is significantly below the production cost of at least 9,300 rubles per ton.

Export challenges are primarily attributed to restrictions in the Black and Azov Seas, which hinder loading and shipping processes. This has caused grain to remain on the domestic market, increasing supply and exerting downward pressure on prices. Consequently, the International Grains Council (IGC) has lowered its September estimates for Russian wheat exports to 41.5 million tons, down from 3.7 million tons compared to August projections.

To mitigate the crisis, the Russian government has implemented a temporary suspension of export duties on grain supplies to countries outside the Eurasian Economic Union, effective retroactively from September 1 through the end of 2026. Additionally, Moscow is allocating approximately 10 billion rubles to subsidize rail transport from high-production regions to alleviate pressure on maritime logistics.