Russia is to ban the export of grain from 15 August to 31 December after drought and fires devastated crops.
A quarter of Russia's grain output was exported in 2009.
The announcement by Prime Minister Vladimir Putin sent wheat prices to a 23-month high.
Prices were already high due to concerns about the impact of the drought and fires on Russian wheat exports.
However, the BBC reports that many commodities analysts insist there is currently a surplus of wheat in global markets following record harvests in 2008 and 2009.
They say speculators have been driving wheat prices artificially high because they are hoping to make a profit from the worries over Russian exports.
However, the United States - the world's largest exporter - predicts a bumper harvest of its current crop.
Russia is banning the export of grains including wheat, barley, rye and maize. It will also ask Kazakhstan and Belarus to follow the suit.
Mr Putin said that grain from the state reserves would be distributed to regions with the greatest need.
He added that the government would provide 10 billion roubles ($US335 million) in subsidies and another 25 billion roubles in loans to agricultural companies affected by the drought.
