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Bad weather to jeopardise Russia’s grain yields, 16.07.18

Russia expects this year’s harvest to be 10-15% lower than in 2017

The record grain harvest collected by Russia in 2017 isn't likely to happen again this year. Last season's close-to-ideal weather conditions brought 134 million tonnes of grain, while this year's harvest is expected at around 115 million tonnes because of ''adverse weather and the condition of winter and spring crops''.

Drought in the southern Russian regions of Rostov, Stavropol and Volgograd coupled with extreme cold in Ural and Siberia is threatening this year's grain harvest, according to bne IntelliNews. The Hydrometeorological Centre of Russia expects that Russian grain harvest in 2018 will be 10-15% lower than in 2017 due to adverse weather and the condition of winter and spring crops.

In 2017, Russia managed to collect an all-time record-high harvest of 134 million tonnes. The success helped to keep food inflation low and brought $20 billion in grain export revenues. According to previous estimates, Russia was supposed to get another solid grain harvest of 116,9 million tonnes in 2018, but major market watchers have recently changed their forecasts. For example, the Moscow-based Institute for Agriculture Market Studies (IKAR) has cut the overall harvest forecast from 117 million to 114 million tonnes and wheat harvest forecast from 73,5 million to 71,5 million tonnes. The United States Department of Agriculture has reduced Russia's wheat harvest estimate by 5% to 68,5 million tonnes. The Ministry of Agriculture has lowered the official harvest target to 110 million tonnes, and it could further fall to 100 million tonnes.

An unusually dry weather in Russia's grain-growing southern regions is the main reason for the revaluations. Weather conditions made harvesting begin earlier than last year, so yields on the grain sown in spring can be hit if the drought does not end soon. ''If agriculture producers do not see rains in the nearest weeks, the potential of yields will face additional significant damage,'' said SovEcon agriculture consultancy, as the moisture content in the soil of some southern regions is at the lowest level in five years. The consultancy plans to update its forecast for the 2018 grain and wheat harvest next week. Earlier, it expected 118,6 million tonnes of grain and 72,5 million of wheat.

The unfavourable weather is also affecting Ukraine where fears are rising that the country's grain harvest can drop by half compared to the previous year.

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