Russian wheat prices declined last week as harvesting gathered pace and eased concerns over crop delay and grain quality, an analyst and traders said on Monday. So far, this year's harvest in Russia, one of the world's top wheat exporters via the Black Sea, has been 40 percent down on last year due to rain.
Some 9.9 million tonnes of wheat have been harvested with yields at 3.59 tonnes per hectare from 11 percent of the planned harvesting area, as of July 11, according to the Agriculture Ministry. This compares to 17.0 million tonnes and yields of 3.22 tonnes per hectare a year ago. However, the harvest so far is enough to put pressure on prices, IKAR, an agriculture consultancy, and traders said. Russian prices for new wheat crop with 12.5 percent protein content were down $3 to $248 per tonne at the end of last week on a free-on-board (FOB) basis in the Black Sea compared with a week earlier, IKAR said.
One trader gave the same price level, while another quoted it $1 lower - at $247 per tonne. However, SovEcon, another leading consultancy in the sector, quoted FOB prices for the same protein content flat at $250-$255 per tonne.
"Market participants are concerned about the decline in new crop quality and the delay in harvesting," it said. The data shows higher yields compared to the same date a year ago, but is flat when compared to yields of equal harvest area, it said. For the period from July 1, when the new 2014/15 marketing year started, until July 9, the country has exported half a million tonnes of grain, including a third of a million tonnes of wheat, the agriculture ministry said, citing customs data.
Russia's 2013/14 grain exports rose 62 percent to 25.4 million tonnes of grain from the previous year, including 18.3 million of wheat, 2.7 million of barley and 4.1 million of maize (corn). SovEcon also said Russian export prices for sunflower oil were down $10 to $850-$860 a tonne from the previous week on an FOB basis in the Black Sea. IKAR quoted the white sugar price index in Russia's south down at $842 a tonne last week. Russia's beet sugar output is set to remain stable at 4.4 million tonnes this year, according to IKAR forecast.
Russian farmers have sown 918,600 hectares of sugar beet this year, up 1.4 percent year on year, the ministry said. For results from the first sugar beet test click on Between January 1 and July 7 the country imported 501,600 tonnes of raw sugar, up 43 percent year-on-year, excluding supplies from Belarus and Kazakhstan, the ministry said.
