IKAR in Mass Media

Russian wheat prices fall as buyers bet on export tax removal

30 апреля 2015 года

Russian wheat prices continued to decline last week on expectations that Moscow will remove its wheat export tax from July 1 and on high supplies as farmers sold from stocks to free up storage ahead of the new season, analysts said. The government plans to consider either cancelling or extending the tax by early June. The tax, which was imposed to cool domestic prices and food inflation when the rouble tumbled last winter, is due to run until June 30.

Black Sea forward prices for Russian new crop wheat with 12.5 percent protein content stood at $191 per tonne on a free-on-board (FOB) basis at the end of last week, down $2 from a week earlier, the IKAR agriculture consultancy said. "This price assumes that an export tax will be cancelled," IKAR head Dmitry Rylko told Reuters.

"Farmers are selling grain stocks to increase working capital and free up storage capacity," said SovEcon, another Moscow-based consultancy. President Vladimir Putin appointed Alexander Tkachev, the governor of key wheat-producing region Krasnodar, as agriculture minister last week. "This (appointment) raises the chance that the export duty will not be extended," SovEcon added.

The fall in Russian wheat prices, which are also tracking a drop in European prices to a six-month low, has boosted demand from Asian buyers. It has also spurred sales into government stocks, SovEcon said. Russia's state stock replenishing programme set a weekly record for this season last week, with the government buying 114,000 tonnes of all grain versus 37,800 tonnes a week earlier. Domestic prices for third-class wheat were down 200 roubles at 9,250 roubles per tonne in the European part of Russia on an ex-works basis, SovEcon added.

This is compared with government offers for this class of wheat of up to 10,100 roubles a tonne. It has bought 687,000 tonnes of all grain types on the domestic market since the start of the programme in October. In the domestic sunflower seed market, SovEcon said prices fell 350 roubles to 20,725 roubles per tonne, while IKAR pegged its sunseed price index at 21,300 roubles per tonne. According to SovEcon, FOB Black Sea prices for crude sunflower oil were up $10 to $760-770 per tonne, while IKAR quoted them at $780-785.

IKAR's white sugar price index for Russia's south was at $758 per tonne, down $17 from a week ago.

Source: Business Recorder | #grain | Comments: 0 Views: 108

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