(Bloomberg) -- Top wheat exporter Russia is struggling to ship its record harvest.
Analysts have progressively hiked estimates throughout the summer as yields were buoyed by good weather, with the crop expected to notch an all-time high. That should fuel a similar surge in shipments, which seasonally peak at this time of year, but sales so far are running well behind the norm.
Russian wheat exports in July and August are estimated at 5.8 million tons, a “painfully slow” rate and 28% behind last year, according to research firm SovEcon. The Russian Grain Union also said sales are trailing the prior season, when the country reaped a much smaller crop, Interfax reported. The number of export destinations and traders shipping wheat has halved, it said.
Russia's invasion of Ukraine hasn't triggered sanctions on food and agriculture trade. Still, it's spurred logistical and financial constraints, with some banks and shipping companies opting to shun the region.
Ukrainian wheat sales are also running at only about a third of normal, although a recently opened grain-export corridor through the Black Sea might eventually speed the pace of shipments. The two countries historically dominate global wheat trade at this time of year, and more importers are turning to alternative origins like the European Union.
That could add to costs for importers. Chicago wheat futures have wiped out a rally fueled by the war on the basis Russia will export a record crop. Prices are likely to rise if that doesn't materialize, Rabobank analysts said Tuesday in a report.
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