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IKAR in Mass Media

Wheat Drops, Erasing Gain, on Higher Supply From Russia, Ukraine

10 мая 2011 года

April 15 (Bloomberg) -- Wheat futures declined, erasing earlier gains, on speculation higher exports of the grain from Ukraine and Russia's return to the export market may boost global supply. Corn and soybeans also fell.

Wheat for July delivery declined 0.4 percent to $7.735 a bushel on the Chicago Board of Trade at 2:32 p.m. Singapore time, erasing a 0.9 percent gain earlier. It is set for a 7.1 percent loss this week, the first in five.

Ukraine has the potential to boost grain exports to 22 million or 23 million metric tons in the season starting July 1, from about 11 million tons this season, Serhiy Feofilov, the head of UkrAgroConsult, said yesterday.

"There's an expectation that a good northern hemisphere crop will weigh on prices," Simon Clancy, manager for the export brokerage at FCStone Australia Pty., said by phone from Sydney. "We're already seeing signs of that out of Russian and Ukrainian markets."

Grain harvests in Russia may range between 80 million tons and 88 million tons this year, the Institute for Agricultural Market Studies said yesterday. That compares with the institute's estimate of 84 million tons in February.

Russia banned grain exports from Aug. 15 to at least July 1 after drought wiped out 37 percent of its crops. Russia was the world's second-largest exporter of wheat in the 2009-2010 season, before grain crops suffered from the worst drought in at least half a century.

Russian Discount

Grains in Russia trade at a 30 percent to 40 percent discount to global prices after the ban, First Deputy Prime Minister Viktor Zubkov said last month.

The nation may export about 9 million tons of grains in the next marketing year if its harvest reaches 84 million tons and final carryover stocks are 15 million tons as of July 1, Dmitry Rylko, general director of the institute known as IKAR, said. Global grain prices may decline by about $75 a ton if Russia resumed exports, Rylko said.

July-delivery corn lost 0.5 percent to $7.575 a bushel in Chicago, swinging from a gain by the same amount earlier. The contract is set for a 2.1 percent loss this week, the first in five weeks.

Exporters in the U.S. sold 1.1 million tons of corn in the week to April 7, from 808,904 tons a week earlier, the Department of Agriculture said in a report yesterday. Rain, thunderstorms and snow in the Midwest may persist in the 10 days from yesterday, slowing early planting and field work.

"Fundamentals remain very constructive in the corn market, with U.S. inventories drawn to extremely low levels," Barclays Capital said in a report e-mailed yesterday. "A wet spring planting season are unlikely to ally supply concerns."

Soybeans for July delivery declined 0.4 percent to $13.38 a bushel in Chicago, set for a 4.7 percent loss this week.

Farmers in Argentina, the world's third-largest grower and exporter of soybeans, are selling the oilseed at a fifth of the average pace, as they wait for prices to rise.

The volume of Argentine soybeans sold at the Rosario Cereals Exchange fell to about 5,000 to 10,000 tons, compared with the normal volume of 40,000 or 50,000 tons at this time of the year, Lorena D'Angelo, an analyst at the exchange, said yesterday from Rosario.

Source: Bloomberg  |  #grain   |  Comments: 0   Views: 44

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