Russia, the world's top wheat exporter, has eliminated its wheat export tax for the first time since the levy was introduced in 2021, according to a statement reported by Interfax citing the Russian Ministry of Agriculture.
The decision will take effect on July 9, marking a significant shift in Moscow’s approach to balancing domestic supply and export competitiveness.
The export tax, originally designed to stabilize domestic food prices and prevent excessive overseas shipments, had been a source of ongoing friction between the government and Russian grain producers. The removal of the tax comes amid rising global wheat prices and growing expectations of tighter supply in the months ahead.
Under the current mechanism, the export tax is calculated weekly and is based on 70% of the difference between a reference price—derived from actual export contract data—and a base price set by the Ministry. The higher the base price, the lower the resulting export tax. For the latest calculation, the reference price was set at \$228.70 per ton, effectively bringing the tax rate down to zero.
This is a stark contrast to earlier this year, when the tax peaked at 4,699.6 rubles (approximately \$59.87) per ton in January—an all-time high that stirred discontent among farmers.
Russian wheat producers have long urged the government to cancel or reduce the levy, arguing that it cuts into their profit margins and only a small fraction of the revenue collected is reinvested into the agricultural sector.
The move is likely to boost the competitiveness of Russian wheat on the international market, particularly as countries across Africa, the Middle East, and Asia continue to rely on Russian grain to meet their food security needs.
With harvest season underway and geopolitical tensions still influencing global commodity markets, Russia’s latest policy shift could significantly influence global grain trade dynamics in the second half of 2025.
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