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IKAR in Mass Media

Wheat prices up in Russia's East, state may intervene

30 июля 2012 года

MOSCOW, July 30 (Reuters) - Concern over poor harvest yields pushed wheat prices higher in Russia's eastern regions last week, adding to speculation the government may be forced to sell a part of its stock, analysts said on Monday.

Russia is ready to sell some grain via state interventions, agriculture minister Nikolai Fyodorov said last week but did not specify when the intervention could take place.

From April to June Russia sold about 2 million tonnes of grain in state interventions and still has about 5 million tonnes in its stock.

Wheat prices rose in Siberia, Urals and Volga regions despite stable prices in key export South regions thanks to strong demand from local clients and buyers from other regions, the SovEcon consultancy said in a note.

"A significant shortage of crop becomes more evident in Volga region, which is harvesting the new crop now," SovEcon said. "Urals and Siberia will start to harvest later, but it is difficult to expect a high crop there."

Russia's southern breadbasket regions saw persistent rains after spring drought but weather remained dry in Siberia and Volga region, raising fears of possible disruptions in the country's grain export.

The pace of Russia's grain exports in 2012/13 season still lags the previous year. In the first three weeks of July, Russia exported 1.13 million tonnes of grains, including 975,000 tonnes of wheat, Dmitry Rylko, head of the Institute for Agricultural Market Studies (IKAR), said in a note.

Russia exported 1.66 million tonnes of grains and 1.30 million tonnes of wheat in the first three weeks of July last year.

Wheat with 12.5 percent protein content was stable at $310 per tonne in Russia's main deep-water ports last week, IKAR added. Barley feed prices in deep-water ports fell $5 to $295 per tonne last week.

SovEcon saw prices for fourth grade milling wheat in deep-water ports stable last week at 9,200 roubles-9,400 roubles ($290) per tonne on a carriage-paid-to (CPT) basis.

Russia's wheat prices in shallow-water ports increased to 8,700-8,800 roubles per tonne last week from 8,500-8,600 roubles, SovEcon said.

European milling wheat futures rose sharply in opening trade on Monday, tracking Chicago grain prices, as weather forecasts and crop surveys raised fears of more damage to U.S. crops.

Benchmark November milling wheat was up 7.50 euros or 2.91 percent at 265.25 euros a tonne by 0852 GMT, after rising as high as 265.75 euros in opening deals.

Russia has harvested grain and legumes from 24.1 percent of the total target area, bringing in 24.8 million tonnes compared to 25.3 million tonnes a year earlier, according to Russia's Agriculture Ministry harvest data as of July 26.

In particular, as of July 26 the wheat harvest rose to 19.4 million tonnes compared to 17.5 million tonnes a year earlier with yields at 2.46 tonnes per hectare.

Russia's Agriculture Ministry's official estimate of 2012 grains crop stands at 80-85 million tonnes. The Russian state weather forecaster cut its 2012 grain crop outlook, including legumes, to 77-80 million tonnes last week.

For sunseeds, SovEcon said export prices for crude sunoil were stable at $1,150 per tonne free-on-board (FOB) at the Black Sea port of Novorossiisk, while prices inland rose 750 roubles to 38,575 roubles per tonne. New crop rapeseeds prices were up at $530 per tonne from $514 per tonne, IKAR said. SovEcon pegged it at 15,500-16,500 roubles ($480-510) per tonne.

Sugar prices in southern Russia were almost unchanged in rouble terms at 26,000 roubles per tonne and slightly decreased in dollars to $797 from $807, IKAR said. The prices reached its peak and are expected to decline as first Russian plants starts beet sugar production soon, it added.

($1 = 32.06 Russian roubles)

Source: Reuters  |  #grain   |  Comments: 0   Views: 47

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