MOSCOW, Russia – The US Department of Agriculture is concerned that Russia may occupy the dominant position on the world wheat market. The analyst, Andrew Sowell, has revealed that Russia’s share of the world wheat market is increasing while the US is in a very vulnerable position.
He noted that Moscow has penetrated markets previously controlled by the US, such as Nigeria or Egypt, according to the Tri-State Livestock News portal.
In addition, Russia begins to create competition for US producers supplying grain to Mexico. Although Washington continues to play a dominant role in the Mexican market, Russia has been able to take advantage of increased production to offer lower prices and higher transportation costs.
The US is currently planting wheat in the smallest territory in the last 100 years, and Russia, on the other hand, is waiting for an abundant new crop.
And while US wheat is still competitive, Sowell said this is unlikely to hold into the next marketing year, “unless the weather intervenes.”
The expert concluded that the US tends to reduce its share of the wheat market, while Russia has a stable position in this area.
In 2018, Russia had a large growth in its agricultural exports, becoming the world’s largest exporter of wheat. From January to September 2018, Russia’s wheat and mescal flour exports increased by 54.3% compared to the previous year.
Surging production means Russia is now the world’s leading wheat exporter, Sowell said, with production nearly doubled in the last 10 years as Russia shifts small grain production over to wheat.
Sowell credited Russia’s ability to quickly increase its yield to planting better varieties, shifting from spring to winter wheat, and improving planting technology, fertilization and irrigation, plus recent years of good weather.
“Still, Russia is playing catch-up, since its yields have been behind other countries,” the expert said.