Russian wheat export restrictions expected

The last couple of weeks have seen some news out of Russia that have resulted in dramatic price swings. To catch up, a few Fridays ago rumors begin to circulate that the Russian Agriculture Ministry intended to curb wheat export demand by placing limits on shipments once exporters hit 30 million metric tons of exports. This hit the news not by an official announcement from the Russian government, but from a word-of-mouth exchange with one of the exporters allegedly present during a discussion about this potential policy. Prices climbed immediately on this news, as the total wheat supply situation is contracting this year due to poor crops in the European Union and Eastern Australia. If another top exporting country (Russia) is pulling itself out of the market, it puts more demand on the U.S. and Canada to fill global demand.