IKAR in Mass Media

Russia's domestic wheat prices set to fall for 4th week

25 февраля 2013 года

MOSCOW, Feb 25 (Reuters) - Russia's domestic wheat prices are likely to fall for a fourth week in a row thanks to sales from the state grain stocks and to active offers from farmers who need money for spring grain sowing, analysts said on Monday.

Russia, normally one of the world's major wheat exporters, was hit by a drought last year, which slashed its harvest by one third, depleted its stocks and sent wheat prices to record highs.

Its domestic wheat prices rose from August until early February, when the government's moves to cool demand via sales from its intervention stocks started to work.

"We still expect the downward trend to continue in the short term," SovEcon agricultural analysts said in a note. "In addition to ongoing sales from the interventions fund, a seasonal increase in demand for working capital from farmers adds pressure on the prices."

The Russian government expanded the list of the regions allowed to buy grain from its stocks in February. Since the start of this marketing year on July 1, it has sold 1.94 million tonnes of grain. For the whole season to end-June 2013, its sales are expected to reach about 4.5 million tonnes.

The average domestic EXW (ex-silo) price in the European part of Russia for milling wheat declined by 175 roubles to 11,325 roubles ($370) per tonne last week, SovEcon said.

Feed wheat lost 150 roubles to reach 11,000 roubles per tonne last week, while barley fell 250 roubles to 9,250 roubles per tonne. Maize (corn) prices were down 125 roubles at 9,325 roubles per tonne.

The Institute for Agricultural Market Studies (IKAR) pegged milling wheat in Russia's South at 11,000 roubles per tonne last week.

Since the start of the 2012/13 season on July 1, Russia has exported 14.33 million tonnes of grains, including 10.3 million tonnes of wheat, according to IKAR.

Russia's grain exports were estimated at about 215,000 tonnes, mainly maize, for the first 20 days of February, it added.

Purchasing prices for maize fell to 8,700-9,100 roubles a tonne on a carriage-paid-to (CPT) basis last week from 9,000-9,300 roubles per tonne, SovEcon added.

Domestic prices for sunflower seeds fell 50 roubles to 16,500 roubles per tonne, it said. Export prices for crude sunflower oil were flat at $1,175 a tonne on a free-on-board basis.

Sugar prices were down $18 at $701 a tonne in Russia's south, IKAR said.

($1 = 30.4412 Russian roubles)

Source: Reuters | #grain | Comments: 0 Views: 64

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