American media reports suggest that Russia has become the world's dominant producer of grain.
(Baonghean.vn) - According to Bloomberg, Russia is confidently consolidating its dominant position in the wheat market. This is thanks to a record harvest and low production costs. In addition, there is no intense competition from other countries.
In a recent report, Bloomberg stated that the record wheat harvest for the second consecutive year solidifies Russia's position as the world's number one exporter and its dominance in the global market.
Bloomberg reports that deliveries are reaching record levels, as Russian traders “gradually overcome the financial and logistical difficulties” that some of them faced when Russia began its special military operation in Ukraine.
According to Bloomberg, Russia's "overflowing grain stocks" have become a blessing for wheat consumers, who have been affected by the inflation crisis and rising cost of living. The record supply has now driven wheat prices down to their lowest level in nearly three years.
"Russian wheat doesn't have many competitors. Currently, Russia is the one determining market prices," said Hélène Duflo, a grain market analyst at Strategie Grains.
Due to oversupply causing prices to fall, Russia is trying to use its dominant position to set a price floor.
However, the price floor is also another sign that the Kremlin is seeking to tighten control over Russian grain exports to the world market.
International traders left Russia earlier this year amid a wave of fierce criticism against foreign companies. Meanwhile, Moscow continued to attract buyers in Africa and the Middle East.
Earlier this week, the U.S. Department of Agriculture raised its forecast for Russian exports while lowering its forecast for global supply. This further reinforces Moscow's dominant position in the global wheat market.
According to Alexander Karavaytsev, senior economist at the International Grains Council, despite the ongoing uncertainty surrounding Ukraine's grain supply, Russia's abundant supply helps mitigate any potential concerns.