Norwegian Grain Price Secured from Russian Export Ban

Photo : Tumi-1983 | Russia exported 21.4 million tons of grain in the previous season , of which 18.3 million tonnes of wheat. The reason for the export shutdown is the severe drought and record heat that has destroyed large parts of the Russian grain harvest this year.

The temporary export suspension will become effective from 15 August. This applies to all kinds of grains. At the same time, Russia declared that Belarus and Kazakhstan, which is in the common customs union with Russia, plans to stop the export of grain in the same period.

Before the message, International Grain Council ( IGC ) forecasted that Russia will export 13.4 million tonnes this season , 12.8 million tonnes of which would be wheat. The message triggered grain prices on international commodity exchanges to its highest in two years.

The situation in Norway

Norway 's harvest season is underway in Østfold and Vestfold. In Eastern Norway, it will be in coming weeks after several dry and fine weather in the following days. However, excessive rain during the season caused moisture damage to the fields and the grain harvest is expected less than normal in Trøndelag. Overall, it is expected that a corn crop will be at the average of the last five years. However, the experts think that it is too early to say how the Norwegian grain qualitatively.

Norwegian producers is shielded from fluctuating world market prices through the tariff rates on imports of cereals which is determined according to the difference between the Norwegian price and world market price. It means that as long as the world market price is lower than the Norwegian price level, the world market price does not affect the domestic price level.

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