06:34 GMT +318 October 2019
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    Wheat harvest in Russia's Kaliningrad Region.

    Russia 'Beats' EU by Becoming Top Global Wheat Exporter

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    In 2016, the grain harvest in Russia may break all records. The country has already become the top supplier of wheat in the world and in the coming months it is looking to strengthen its positions.

    This positive trend can be explained by several factors. Russia's success has arisen not only from good weather conditions, but also clever financial investments.
    According to Russian newspaper Vzglyad, one of the main reasons has been sustainable financial investments into the agricultural sector.

    Moreover, anti-Russian sanctions introduced by the US and the EU amid the Ukrainian crisis are another factor that has given impetus to increased agricultural exports.

    "The sanctions also turned out to be beneficial as they cheered up the Russian agricultural market," Russian financial expert Kirill Yakovenko told the newspaper.

    According to a report of the US Department of Agriculture (USDA), Russia will overtake the EU in terms of wheat exports for the first time over last few years.

    In the period of 2016-2017, Russian wheat exports will rise 4.5 million tons to 30 million tons, while the EU's wheat exports, by contrast, have dropped by seven million tons to 27 million tons over the last two months.

    For instance in France, the quality of its grain was severely damaged due to frequent rains. Prices, by contrast, remained quite high, scaring potential customers away, German newspaper DWN wrote.

    At the same time, the demand for Russian wheat has increased due to favorable prices as result of exchange rate differences. For example, Russia easily signed contracts for the supply of wheat to Egypt, mainly due to the high quality and the low price of its product.

    "Egyptians have been attracted by the availability and relative proximity of the Russian goods. For example, a ton of Russian wheat costs about 10,000 rubles, or $150, while prices of the Americans and the second market leader, the French, are by 15-20% more expensive," Vzglyad wrote.

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    exports, grain, wheat, Europe, Russia
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