IKAR in Mass and Industry Media

Russia approved the launch of a new wheat export tax from July

Agri.EU

The new tax is set at 50 percent of the customs price per tonne minus 5,500 roubles ($105), but not less than 50 roubles per tonne, the government said in a statement.

Russia approved the launch of a new wheat export tax from July 1, which traders say could threaten profits on advance contracts for the new crop if the rouble weakens in coming months. Russia's government said on Friday that the new tax was intended to stop exports surging if the rouble drops steeply. The rouble fell sharply against the dollar in 2014, fuelling grain exports, and is yet to fully recover.

The new tax is set at 50 percent of the customs price per tonne minus 5,500 roubles ($105), but not less than 50 roubles per tonne, the government said in a statement.

"This level of export tax, apart from fiscal function, will have a regulatory impact depending on the change in global prices," the government said.

The profitability of already concluded forward contracts for the new marketing year, which starts on July 1, is now at risk because exporters do not know what the rouble rate will be at the moment of supply, several traders said.

"I am ready to pay the tax but I want to know how much I will pay," one trader said. The tax may make already concluded contracts loss-making if the dollar strengthens to around 60 roubles from the current 52 roubles, he added.

Black Sea forward prices for Russian new crop wheat with 12.5 percent protein content were at $194 per tonne (10,204 roubles at current rate) on a free-on-board (FOB) basis at the end of last week, according to IKAR agriculture consultancy.

04.06.15

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