* Russia’s Q2 grain export quota set at 7 mln T

* May be depleted by mid-May or earlier - ministry

* Ministry: “only domestic market will remain after that”

* Several supplies to Egypt might be affected - traders (Writes through to add new comment from Russia)

MOSCOW, April 17 (Reuters) - Russia, the world’s biggest wheat exporter, will suspend grain exports until July 1 once its export quota is exhausted, which is currently expected to happen in mid-May, its deputy agriculture minister Oksana Lut said on Friday.

Russia last fully banned wheat exports in 2010 when drought hit its harvest, rocking global markets. Turkey, Egypt and Bangladesh are the largest buyers of Russian wheat.

“The quota was introduced for the period from April 1 to June 30, 2020. After it is depleted, the supplies outside the (Russia-led) Eurasian Economic Union will be stopped for this period,” Lut said.

“Based on the pace of the quota filling, it is expected that exports will be suspended in mid-May.”

There are no plans to increase the second-quarter quota, and the agriculture ministry could keep the grain export quota mechanism in the new 2020/21 marketing season, which starts on July 1, Lut said.

To conserve supplies for the domestic market during the coronavirus outbreak, Russia, along with several neighbouring countries which are large wheat exporters via the Black Sea, limited grain exports earlier in April.

These moves led to a lower than usual number of suppliers at a tender by Egypt’s state grain buyer on Thursday, as some traders did not submit offers due to fears over potential export bans in the Black Sea region.

“Mid-May is now increasingly seen as the time the quota will be used up because of the rapid pace of Russian exports. There is perceptible caution about selling Russian wheat in international markets beyond this date,” a European trader said.

If the Russian quota is depleted in mid-May and exports are suspended, it could hit Egypt’s latest purchases of Russian wheat, Cairo-based traders said.

“This may very well hurt the latest vessels that Egypt booked,” one of them said.

Egypt, the world’s largest wheat buyer, booked 180,000 tonnes of Russian wheat in its tenders this week in an effort to beef up its strategic reserves amid the coronavirus.

The shipment of the three supplies is due on May 15-25, May 21-June 5 and May 26-June 5.

If Russia’s grain exports are suspended, there will be no exceptions for certain companies, Lut said. “The mechanism was developed without dividing the permitted amount of exports among market participants.”

Russia set the quota for grain exports at 7 million tonnes for the April to June period.

Although the amount is roughly in line with what the country was expected to ship in that period, Russia's online calculator shows here that as of Friday only 4.2 million tonnes of grain remained available for export from the quota.

The Russia-led Eurasian Economic customs union, which includes Kazakhstan, Belarus, Armenia and Kyrgyzstan, is exempt from the quota, Lut said, adding that Kazakhstan and Kyrgyzstan had already requested Russian grain for purchase.

There is still a chance that Russia’s grain exports will slow down and the quota will run out later than in mid-May, Andrey Sizov, at SovEcon consultancy, said. “We expect a sharp decrease in the pace of exports,” he said.

Russian farmers have been selling grain to exporters more actively in recent weeks as global prices rose on Russia’s decision to limit exports and other factors, Lut said.

However, this process will soon slow as exporters are already taking into account the risk of missing out on what remains of the export quota, she added. (Reporting by Polina Devitt; Additional reporting by Maha El Dahan and Michael Hogan; Editing by Jan Harvey, Veronica Brown and David Evans)