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Jul 17, 2023

Export prices of Russian wheat pushed lower by new crop, low demand

in Commodity News30/05/2023 Export prices of Russian wheat are softening further

in Commodity News30/05/2023

Export prices of Russian wheat are softening further in anticipation of a new harvest and amid low demand from global importers, analysts said.

A deal to allow Ukraine to export its grain safely across the Black Sea was extended last week for two months.

The prices of Russia's new wheat crop with 12.5% protein content, delivered free on board (FOB) from the Black Sea, was assessed at $230 a tonne compared to $242 a tonne from the previous week for the old crop, the IKAR agriculture consultancy said.

The Russia-focused agricultural consultancy Sovecon estimates total Russian wheat exports in May at 3.8 million tonnes, compared to 1.2 million tonnes in May 2022 and 1.5 million tonnes on average.

Russia exported 1.07 million tonnes of grain last week compared to 1.21 million tonnes a week earlier, including 0.97 million tonnes of wheat compared to 1.07 million tonnes a week earlier, Sovecon wrote in its weekly note, citing port data.

As of May 25, 24.6 million hectares of crops were sown, compared to 22.3 million hectares by that date in 2022, of which 11.1 million hectares were under spring wheat (9.6 million hectares in the same period of 2022).

Sovecon noted dry weather in several regions of the country.

"There is growing concern about crop conditions in Siberia and the Urals… Current conditions for these regions are challenging but it's a bit too early to get too concerned. If plants get even light precipitation in early June and something more substantial in the second half, the yield potential impact could be limited," analysts said.Source: Reuters (Reporting by Olga Popova; Editing by Gareth Jones)