IKAR in Mass and Industry Media

Russian wheat export prices keep rising as May frosts hit crops

Reuters

Russian wheat export prices rose last week as the current crop was hit by unseasonal May frosts.

The price of 12.5% protein Russian wheat scheduled for free-on-board (FOB) delivery in June was $221 a metric ton, up from $216 a ton the previous week.

The Sovecon agriculture consultancy pegged the same class of wheat at $223-227 a ton, up from $215 to $219 a ton FOB.

Three of Russia’s key grain-growing areas declared a state of emergency last week, citing May frosts which have caused severe damage to crops and will reduce this year’s harvest.

Russia’s harvest in 2024 will be ample to maintain food security despite the frosts, Dmitry Patrushev, the acting agriculture minister who has been nominated for the post of deputy prime minister in the next government, said at the weekend.

Russia’s agriculture ministry has not changed its grain crop forecast of 132 million metric tons in 2024 but may adjust it due to bad weather, the Interfax news agency quoted Oksana Lut, nominated for the post of agriculture minister, as saying on Sunday.

After lowering forecasts in late April and early May due to drought in the southern regions of the country, analysts have again reduced crop and export forecasts on the back of two waves of May frosts, particularly affecting central Russia, the Volga region and northern parts of the Southern Federal District.

Sovecon cut its wheat harvest forecast last week by 3.4 million tonnes to 89.6 million, while IKAR on Monday reduced its wheat forecast by 5 million tonnes to 86 million.

Russia is the world’s largest wheat exporter. Its exports rose to 0.91 million metric tons of grain last week, from 0.77 million metric tons the previous week. Exports included 0.85 million metric tons of wheat, up from 0.67 metric tons a week earlier, Sovecon wrote, citing port data.

The first estimate of wheat exports by Sovecon in May is 3.9-4.3 million metric tons, compared with record-high 4.1 million tons a year earlier.

As of May 3, farmers had seeded 7.5 million hectares of grains compared to 10.0 million hectares in the same period in 2023. That included 1.9 million hectares of spring wheat, compared to 3.3 million last year, Sovecon wrote.

15.05.24

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