Frustrated expectations: why grain producers in Russia will not receive excess profits again

Published Jul 11, 2024

Tridge summary

The article outlines the anticipated harvest and export expectations for the upcoming grain season in Russia, highlighting a forecast of a smaller harvest than the previous year but still a significant one. Despite the positive yield and record export volumes in the recent grain season, farmers are not experiencing increased profitability due to fading hopes for higher prices. The geopolitical challenges and weather conditions have influenced the grain market, leading to shifts in export destinations. Despite these challenges, there is optimism for the future, with the creation of a grain exchange among BRICS countries and prospects for increased exports to growing markets in Africa and Asia, offsetting the potential impact of tariffs on Russian grain supplies to the EU. However, farmers face financial challenges, with profitability decreasing in remote areas from the export infrastructure.
Disclaimer: The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

The new grain season will bring, although smaller than last year, but still a considerable harvest. Exports also promise to be quite active. However, the consistently high results of the industry do not yet inspire farmers. Hopes for rising prices are fading, and grains will likely again not show the desired profitability. The logic “smaller harvest means higher prices” may not work in the new grain season (started on July 1). Not long ago, the head of the Ministry of Agriculture, Oksana Lut, said that her department expects prices to rise both on the global and domestic markets, including due to a reduction in supply. But so far there have been no significant positive dynamics in the grain market, and there are no prospects for an improvement in the price environment in the future, say experts interviewed by Forbes. The completed grain season 2023/2024 can be called positive in terms of yield and export volumes, experts say. “The Russian agro-industrial complex continues to ...
Source: Agrovesti
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