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Russian wheat prices fall under pressure from large crop

Russian wheat prices fell last week, anticipating the biggest crop in post-Soviet history, analysts said on Monday. Russia, a major global wheat exporter to North Africa and the Middle East, could harvest up to 110 million metric tons of grain th...

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Russian wheat prices fell last week, anticipating the biggest crop in post-Soviet history, analysts said on Monday.

Russia, a major global wheat exporter to North Africa and the Middle East, could harvest up to 110 million metric tons of grain this year, according to the agriculture ministry, up 2 million metric tons on the record crop of 2008.

Black Sea prices for Russian wheat with 12.5 percent protein content and supply in August were at $162 a metric ton on a free-on-board (FOB) basis at the end of last week, down $3 compared with a week earlier, Russian agricultural consultancy IKAR said.

Russian farmers had already harvested 34.7 million metric tons of grain by July 22 from 18 percent of the sown area, and yields have so far been higher than a year ago.

"Grain harvesting is proceeding at a high pace, close to the tempo of 2014 when a bumper crop of 105.3 million metric tons was reaped," said SovEcon, another leading agriculture consultancy in Moscow.

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However, the share of high quality wheat remains low, it added.

Russia exported 1.2 million metric tons of grains, including 835,700 metric tons of wheat, from July 1, when the new 2016/17 marketing year started, to July 20, the agriculture ministry said. The pace of exports is up 7 percent year on year.

SovEcon quoted FOB wheat in the Black Sea area at $163 per metric ton, down $1.5 compared with a week earlier, and barley prices at $147, down $1. IKAR pegged barley prices unchanged at $144.

Domestic prices for third-class wheat fell 375 roubles compared with the end of the week earlier to 9,625 roubles ($148) a metric ton in the European part of Russia on an ex-works basis, according to SovEcon. Ex-works supply does not include delivery costs.

SovEcon also said domestic sunflower oil prices remained at 53,825 roubles a metric ton, while FOB Black Sea export prices fell $5 to $775 a metric ton.

IKAR's white sugar price index for southern Russia was at $747 a metric ton at the end of last week, up $7.55 from a week earlier. 

Related Topics: CROPSWHEAT
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