Grains trader Solaris to end Russian transactions, focus on Australia, Argentina

One of the largest exporters of Russian wheat, Swiss-based Solaris Commodities, has stopped new transactions from the country, the company said March 15 in a message to trading partners.

“All activities going forward will be focused on non-Russian origins,” the company said, adding that “Solaris Commodities SA is a Swiss trading, marketing, and shipping company regulated in Switzerland.”

The statement underlined the pressure on trading companies in Russia, which have sought to distance themselves following the country’s invasion of Ukraine.

The risks to shipping have raised the cost of insurance, while punitive sanctions imposed by the US and the European Union have limited the convertibility of the ruble and discouraged banks from providing letters of credit. Russia is the world’s largest wheat exporter, representing a fifth of global trade in the 2020-21 marketing year (July-June).

Solaris said it will honor pre-existing contracts to its destination customers “with their and our bank’s approvals,” but added that its future activities would be focused on non-Russian origins, such as Argentina and Australia.

The trading company said it was motivated by a wish to certainty of supply and efficient execution to private flour millers and governments, its key customers.

Solaris didn’t respond to calls or messages.

Solaris has been in a strategic partnership with Demetra-Holding, a Russian holding company that controls grains elevators, export terminals and logistics.

Demetra-Holding was controlled by VTB Bank, but the sanctioned bank recently reduced its stake to 45%. It exported 4.4 million mt of wheat in the 2021-22 marketing year, or around 12% of the country’s 37.6 million mt, according to consultancy Rosagrotrans.

“Demetra-Holding is not a shareholder of Solaris Commodities SA and cooperates with the сompany on market terms,” a spokesperson for Demetra said in an emailed response March 14.

S&P Global Platts

Tags: Ukraine, Russia, risks, Solaris Commodities, transactions, Demetra-Holding