MOSCOW, Russia (Reuters) — Russia’s wheat export prices are expected to fall seven percent from current levels when the new crop is delivered to the market this summer, said IKAR, one of Moscow’s leading agriculture consultancies.
Russia, a major global wheat exporter, harvested a record crop of 119 million tonnes of grain in 2016 and prospects for this year’s crop are bright so far thanks to favourable winter weather.
Prices for the new wheat crop with a 12.5 percent protein content and for July-August delivery are currently quoted by market participants at US$175 per tonne on a free-on-board (FOB) basis in the Black Sea, IKAR head Dmitry Rylko said in a note.
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The spot prices for the old crop were at $188 per tonne at the end of last week, up $2 from a week earlier. Some farmers are holding on to their grain as the ruble has strengthened and also following a cut in the U.S. Department of Agriculture’s supply forecasts for the 2016-17 season, Rylko said.
SovEcon, another Moscow-based consultancy, quoted FOB wheat at $189.5 a tonne at the end of last week, up $1.5 from a week earlier, and maize (corn) prices at $177 per tonne, up $1.
“Conditions for winter grain sowings remain satisfactory in general,” SovEcon said. Another cold spell is expected in some regions this week but the snow cover is likely to be enough to keep the sowings safe, it said.
SovEcon has cut its 2017 grain crop forecast by one million tonnes to 113 million tonnes, including 69 million tonnes of wheat, it said, after it raised an estimate for the damage of area under winter grain sowings by one percentage point to four percent of the total area.
Russia exported 23.1 million tonnes of grain between July 1 and Feb. 8, down 0.1 percent from a year ago, including 17.9 million tonnes of wheat, the agriculture ministry said.
