IKAR in Mass Media

Soaring Russian wheat price calmed by prospect of govt action

04 февраля 2013 года

MOSCOW, Feb 4 (Reuters) - The rise in Russia's domestic wheat prices has begun to slow on the expectation of sales from government grain stocks to ease tight supply, analysts said on Monday.

Russian grain stocks were hit by last year's drought, sending domestic prices to record highs. Since the start of this marketing year on July 1, the government has sold 1.57 million tonnes of grain but has so far failed to dampen prices that remain too high for export markets.

The country plans to extend the number of regions allowed to buy grain from state intervention stocks, from which it will sell up to an additional 3 million tonnes this year. The idea could be mentioned during Prime Minister Dmitry Medvedev's grain meeting on Tuesday.

"The market is waiting for intervention sales to step up," SovEcon agricultural analysts said in a note on Monday.

"There are more offers in some regions, mainly in the Central Black Earth region, for the first time in a long period."

The average domestic EXW (ex-silo) price in the European part of the country for third-grade milling wheat rose by 75 roubles last week to reach 11,700 roubles ($390) per tonne, SovEcon said. The index added 175 roubles from Jan. 21 to Jan. 27.

Fourth-grade milling wheat was up by 100 roubles at 11,675 roubles last week, while fifth-grade feed wheat rose 75 roubles to 11,275 roubles a tonne, it said.

Domestic prices were near $400 a tonne last week. Egypt, meanwhile, was able to buy 60,000 tonnes of U.S. Soft Red Winter wheat at $306.80 per tonne with freight costs of $25.64 per tonne.

Russia's weekly grain exports were about 100,000 tonnes from Jan. 28 to Feb. 3, the lowest weekly volume since the start of this marketing season, Dmitry Rylko, the head of IKAR, told Reuters.

Purchasing prices for maize (corn) were quoted by exporters at 9,300 to 9,500 roubles a tonne on a carriage-paid-to (CPT) basis last week - almost flat against the previous week's 9,300 to 9,400 roubles a tonne, SovEcon said. Domestic prices for sunflower seeds fell $3 to $561 a tonne, IKAR said. SovEcon cited prices at 16,800 roubles a tonne, down 200 roubles.

Export prices for crude sunflower oil were up $3 last week at $1,168 a tonne on a free-on-board basis, IKAR added, while SovEcon quoted $1,170 per tonne.

Sugar prices were up $11 at $729 a tonne in Russia's south, IKAR said. ($1 = 29.8739 Russian roubles)

Source: Reuters | #grain | Comments: 0 Views: 41

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