The introduction of a permanent duty on Russian wheat will increase pressure on prices

the Russian Authorities in order to regulate the export of grain is developing a mechanism "price dampener", which envisages the introduction of variable export duties with the subsequent return of these funds in agriculture in the form of investments.

From 1 April to 1 June, Russia will test a new mechanism of export duties on grain, which will be 70% of the amount that would exceed the price of $200/t FOB, calculated based on the average weekly dollar prices of contracts on the basis of FOB Novorossiysk. However, experts worry that too often the revision of the rates of customs duties complicate the execution of prisoners in the months ahead contracts.

the Registration of the contracts are planning to start on one of the exchanges, and to calculate the constructor prices, which is currently in development. The head of the Union of grain exporters E. Sern said that in the near future we will establish a Committee of representatives of stock exchanges, analysts and market participants, which will improve the technique of calculation of the indicators and to monitor its relevance. Parameters of alternating duties may be known on Monday, when it released a draft document.

the intention of the government to accelerate exports of wheat from Russia and increasing pressure on prices, which are now at the level 285-290 $/t FOB for deliveries in February and March and 245-250 $/t FOB for August.

the Fall in the price of soft wheat in Chicago yesterday was offset by the depreciation of the Euro.

• the March futures for milling wheat on MATIF remained at the level of 224,75 €/t or 268,9 $/t

European traders believe that the introduction Russia since June of permanent export duty will reduce the competitiveness of Russian wheat for the benefit of Europe.

Despite the good performance of exports, wheat exchange in USA yesterday ended falling under the pressure of rapid strengthening of the dollar, which reduces the export potential of the grain. Export sales of wheat from the U.S. last week rose by 69% to 643 thousand tons (of them to China 200 kt), but only in the season of 22.4 million tonnes from the USDA projected 27 million tonnes, which is by 5.44% higher than the corresponding figure of last year.

the Actual wheat exports for the week fell by 2% to 498 million tonnes, but only in the season reached 16 million tonnes, which is 15% below the pace of last year.

the March wheat futures in the U.S. fell:

• by 3.95 $/t to 234,24 $/t for SRW soft winter-wheat in Chicago,
• by 2.48 $/t to 227,35 $/t for solid winter HRW wheat in Kansas city,
• 1.19 $/t to 228,45 $/t on a firm spring HRS wheat in Minneapolis.