Moscow is confidently consolidating its dominant position in the wheat market. This has become possible due to the record harvest and low cost of production. This is written by Ain Quinn in an article for Bloomberg agency.
Ain Quinn believes that Russia has a record wheat harvest for the second year in a row. According to the author of the article, this strengthens the position of the Russian Federation as the world’s number one exporter of agricultural products.
“Russian wheat does not have many competitors. At the moment the price is determined by Russia,” says Hélène Duflo, grain market analyst at Strategie Grains.
The author of the article emphasises that oversupply leads to a decrease in the cost of goods, and Russia is trying to use its dominant position to set a lower price limit. According to the journalist, “this will not only “appease Russian farmers unhappy with the reduction in income, but will also replenish” the Kremlin’s poor “coffers with additional tax revenues.
“Nevertheless, the minimum price threshold is another sign that the Kremlin is seeking to tighten its grip on Russian grain exports and thus on the world market,” Quinn concludes.
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