"The market must quickly come to its senses": which led to a record rise in price of buckwheat in 10 years in Russia

In the summer of 2021, retail prices for buckwheat in Russia reached their highest level in the last ten years.

So, in June, the cost of cereals on store shelves on average in the country increased from 99.27 to 101.03 rubles per 1 kg.

In July, the value rose to 102.16 rubles, and in August it amounted to 102.51 rubles.

Note that the last time 1 kg of buckwheat cost more than 100 rubles in the summer of 2011.

This is evidenced by the materials of Rosstat.

In total, since the beginning of 2021, buckwheat has risen in retail prices by more than 12%.

The observed price dynamics may be related to the concerns of producers about a possible shortage in the market.

Georgy Ostapkovich, director of the Center for Market Research at the Institute for Statistical Studies and Economics of Knowledge, NRU HSE, shared this opinion in an interview with RT.

“The fact is that so far the agrarians in the Altai Territory have not collected the final harvest, and what the total volume of production will be is not yet very clear.

Against this background, producers could hold back buckwheat and began to sell it less, which led to an increase in prices, ”explained Ostapkovich.

Anna Bodrova, a senior analyst at the Alpari information and analytical center, expressed a similar point of view in an interview with RT.

According to her, at the moment the prospects for the new harvest remain uncertain.

First of all, the expert explains this by the consequences of a long and cold spring, as well as a dry and hot summer.

“It should be noted that last year's harvest was also quite average and, most likely, the level of stocks could have decreased.

As a result, retail chains decided to be ahead of the curve and started raising prices in advance, ”added Anna Bodrova.

Meanwhile, the Ministry of Agriculture of Russia ruled out the possibility of a shortage in the buckwheat market.

The experts of the department assess the current stocks of cereals as sufficient.

In particular, in order to ensure the required supply in the current year, the cultivated areas for buckwheat were increased by 12.1% - to 975.9 thousand hectares.

“As of September 16, about 30% of the area has been harvested, and the cleaning work continues.

The volume of culture production covers the demand of processing enterprises, which allows us to fully meet the needs of the domestic market, ”the Ministry of Agriculture said.

Moreover, to prevent a shortage of buckwheat at the beginning of the summer, the authorities introduced a temporary ban on the export of cereals abroad.

The restriction was in effect from June 5 to August 31 and, according to the Ministry of Agriculture, made it possible to maintain sufficient volumes of raw materials and finished products on the domestic market.

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As noted in the ministry, as of September 15, producer prices for buckwheat showed zero dynamics over the week, and decreased by 0.9% over the month.

In turn, the cost of buckwheat in seven days dropped by 0.9%.

According to experts interviewed by RT, the situation with prices on the buckwheat market should completely stabilize in the coming months.

“In general, there is nothing critical in the current situation, and the market should quickly recover.

This was already the case in 2010, when we observed fires throughout the country, which led to a poor buckwheat harvest.

Against this background, prices for goods first rose and then fell, as manufacturers and sellers found compromises, ”Georgy Ostapkovich recalled.

In his opinion, in the event of a further rise in the price of buckwheat, the government may reintroduce a ban on the export of cereals to other countries.

In addition, a temporary freeze of prices will also help to quickly reduce the cost of the product for consumers, the specialist believes.

It should be noted that the authorities have already used this practice in relation to sugar and sunflower oil.

However, new initiatives of the government may not be needed, Ostapkovich is sure.

In his opinion, in the case of high harvest volumes in the Altai Territory, prices will not only stabilize, but may also go down a little, since there will be more than enough goods.

Anna Bodrova is also expecting cheaper buckwheat in the foreseeable future.

“It will take about a month to call everyone to order and bring prices back to normal. By the end of the year, most likely, buckwheat in stores will again cost its usual 65-80 rubles per 1 kg, ”the analyst concluded.