Main page   About us  |  Our news  |   Our services  |  Contacts
Main page guide Feedback RSS       In Russian



   IKAR in Mass Media
   Market prices
   Graphically speaking
   Market studies



   About us
   Our news
   Our services

IKAR in Mass and Industry Media

It's a Breadmaker's Dream as Russia Faces Glut of Premium Wheat

Bloomberg, 11.07.19

Hot and dry weather in the southern wheat belt has boosted protein levels.

It's a Breadmaker's Dream as Russia Faces Glut of Premium Wheat

It’s a case of too much of a good thing for Russian farmers –they’re reaping unusually high-quality wheat as the new season starts but the abundance of top-notch grain means traders are reluctant to pay big premiums.

Recent hot and dry weather in Russia’s southern wheat belt, where harvesting started a few weeks ago, has boosted the level of protein in the kernels. Higher protein content is linked with gluten, the component that makes bread dough strong and stretchy.

At Andrey Burdin’s farm in the southern region of Krasnodar, the share of higher-quality wheat – with at least 13% protein – is about 80% of the total crop this year. That’s four times as much as usual.

A combine harvester drives through a field of wheat outside Rostov, Russia. Photographer: Andrey Rudakov/Bloomberg

“Quality improvement requires certain effort,” Burdin said by phone. “This year, even those who didn’t make any effort got high quality. Pure luck.”

Some farmers are seeking higher prices for the better wheat but the large supply of such grain makes it difficult, he said. “We have a wall of wheat coming” that has protein upward of 12.5% in southern Russia, according to Dmitry Rylko, director general at consultant the Institute for Agricultural Market Studies, or IKAR.

“We have a wall of wheat coming”

Temperatures were so high in May and June that some analysts started to reduce estimates for the Russian crop. Harvesting is now starting in central Russia and will continue through September as crops ripen in Siberia. As the harvest progresses, the overall quality of the Black Sea nation’s crop may get closer to usual, according to Moscow-based IKAR.

Some southern Russian farmers are holding on to grain, betting the premium for their high-grade wheat will get fatter if crops in other parts of Russia are of lower quality, Burdin said.

Black Sea Rivals

“I have some wheat with 16% of protein. It used to be a first-class achievement before,” he said. “But the offered price is the same as for 12.5%. So much money has been invested in better quality -- is it money down the drain?”

The higher quality still means that traders in the biggest wheat shipper may have to pay higher prices to buy grain from farmers. That’s part of the reason why Russia, typically the main supplier to No. 1 importer Egypt, has been snubbed in the African country’s two most recent tenders in favor of cheaper grain, according to IKAR.

Thin Premium

Ukraine, another major Black Sea wheat exporter, is also seeing high-quality wheat at the start of the harvest. The bulk of grain in the southern region is registering as milling grades after hot, dry weather near harvest time, said Andrey Novoselov, director of Kiev-based consultant Spike Invest Solutions.

More feed-quality wheat may be collected as fieldwork shifts to the north and west, he said. The total crop still has the potential to end up comparable to a normal season, with 50% to 60% ranking as milling quality.

All viewing: 150

Where The Margin Is
Annual Conference Agribusiness
media feedback

IKAR is a member of International research project Agri Benchmark from May 2010

Agri Benchmark

Putin Is Growing Organic Power One T-34 Tank-Tomato at a Time

Grain | Cereals | Sugar | Oilseeds | Feedstuffs & Ingredients | Meat | Dairy

IKAR. Institute for Agricultural Market Studies.

© 2002-2020  
IKAR. Institute for Agricultural Market Studies
24, Ryazansky str., off. 604, Moscow, Russia
Tel/Fax: +7 (495) 232-9007 | |  Feedback

Rambler's Top100 Рейтинг
Google translate: Google translate: Russian Google translate: German Google translate: French Google translate: Italian Google translate: Portuguese Google translate: Spanish Google translate: Turkish Google translate: Lithuanian Google translate: Chinese Google translate: Korea