Russia’s agricultural sector struggles as grain exports drop by a third

Business

29 January 2025, 07:10 PM

Author: Demian Shevko
For the first time in years, Russia is on the verge of losing its leading position in the global grain market. The Russian Grain Union forecasts that in 2025, the country’s grain exports will drop by one-third, according to a Jan. 29 report by The Moscow Times.

Russian farmers are expected to export between 48 and 49 million metric tons of grain in 2025, compared to 72 million tons last year.

Wheat exports alone could fall by 28%, down to 41–42 million tons, the report said.

"Grain exports—one of Russia’s top sources of foreign revenue, generating $15.5 billion in 2023—are already plummeting," the report states.

"As of late January, exports had dropped 42% year-over-year, with only 2.5 million tons shipped since the start of the month."

Russia’s grain crisis worsened by weather, import bans

The decline in exports follows a drop in overall grain production, which was hit by bad weather and a government ban on imported seeds.

During the last agricultural season, Russia’s grain harvest shrank by 14% to 125 million tons, while wheat production fell 16% to 82 million tons.

Of that total, about 10 million tons of wheat rotted in storage, as Russia lacks sufficient storage infrastructure, according to the Russian Grain Union.

"Compared to the record-breaking 2022 harvest, Russian farmers have lost one-fifth of their crops," the report said.

"This is partly due to difficulties accessing high-quality seeds and Western farming equipment."

Government policies deepen the crisis

The Russian government imposed import quotas on foreign seeds, but domestic alternatives yield 20–30% lower harvests. The last reserves of imported seeds have already been depleted.

While last season, this issue affected 30–40% of the harvest, it could impact up to 70% in the 2025 season, the Russian Grain Union warned.

The country’s total grain harvest could drop to 100 million tons next year, further tightening supplies.

EU sanctions on Russian grain

As previously reported, the European Union imposed tariffs on Russian and Belarusian grain imports in 2024, further complicating Russia’s ability to sell its agricultural products abroad.

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