Russia's prices for new crop wheat declined last week after rains improved prospects for the harvest and eased concerns about a lack of soil moisture in some regions of the major global grain exporter, analysts said. Favourable weather in May has brightened the 2014 grain harvest outlook in Russia and Ukraine, easing risks related to the lack of financing available for sowing.
Russian futures prices for the new wheat crop with 12.5 percent protein content were quoted at $258 per tonne at the end of last week, down from $263 per tonne the week before on a free-on-board (FOB) basis in the Black Sea, the Institute for Agricultural Market Studies (IKAR) said. SovEcon, another leading Russian agriculture consultancy, pegged FOB prices for new crop wheat at between $262 and $265 per tonne in the Black Sea, down from $267-$269 the previous week. Russia is expected to export 25 million tonnes of grain during the 2014/15 marketing year, which starts on July 1, flat year-on-year, according to the agriculture ministry forecast.
In May, it exported about 1.6 million tonnes of grain, including about 1.1 million tonnes of wheat, said Dmitry Rylko, the head of Moscow-based IKAR. This would bring Russia's grain exports so far in the 2013/14 year, from July 1 to end-May, to 24.8 million tonnes, including 17.9 million tonnes of wheat, according to Reuters calculations. Russia's July grain exports are likely to be modest compared with the 2.6 million tonnes it shipped in July 2013 due to low wheat stocks and high domestic prices, SovEcon said in a separate note.
