IKAR in Mass and Industry Media

Russian wheat prices fall on state sales, competition

Reuters

MOSCOW, April 9 (Reuters) - Russian wheat prices declined further last week on sales from Russian state interventions and competition from neighbouring Kazakhstan, analysts said on Monday.

"Interventions, which started very swiftly, led to some cooling down of market prices in the European part of Russia," the Institute for Agricultural Market Studies (IKAR) said in a note.

"Some further penetration of Kazakh wheat is observed at both Black and Azov Seas terminals," it added.

The Russian government sold 232,261 tonnes of grain during its first two intervention tenders this year, data from an exchange showed last week.

On a carriage-paid-to (CPT) basis, prices on Novorossiisk have declined to 7,300-7,500 roubles ($250) per tonne from 7,500-7,700 roubles, although exporters said the supply was very limited, IKAR added.

SovEcon analysts wrote in a weekly market roundup that purchase prices of wheat with 11.5 percent protein content in Russian deep-water ports fell to 7,400-7,600 roubles ($250-260) per tonne last week from 7,500-7,800 roubles per tonne on a carriage-paid-to (CPT) basis.

The pace of shipping in shallow-water ports was active, where prices was quoted at 7,000-7,100 roubles per tonne, it added.

However, Russian wheat with 12.5 percent protein content gained slightly, climbing to $276 per tonne from $274 on a free-on-board basis (FOB) in the port of Novorossiisk, although the demand and market remain highly sporadic, IKAR said in a note.

Russia may export between 0.5 million and 1 million tonnes of grain from state inventories, and wheat will account for over half, according to a government source, traders and analysts.

As of end March, Russia exported more than 22.6 million tonnes of all grains, including legumes, which included about 18 million tonnes of wheat, IKAR said.

Egypt, the world's largest wheat importer, has bought 115,000 tonnes of U.S. soft red winter wheat for May 21-31 shipment on a free on board basis last week.

Russian wheat was also offered in the tender during the second week in a row at $279.45-285.00 per tonne, although it did not win, SovEcon added.

Front-month May milling wheat futures were down 0.96 percent, at 211.25 euros a tonne on the Euronext exchange in Paris during the last trading session on April 5. U.S. CBOT May wheat added 0.27 percent to $6.40 per bushel on Monday.

Russian average domestic prices for third-grade milling wheat lost 50 roubles to reach 6,575 roubles per tonne ex-works in European Russia. Fourth-grade prices were at 6,525 roubles per tonne ex-works last week, down 25 roubles, SovEcon said.

For sunseeds, the domestic price index rose to $390 per tonne from $384 per tonne, or to 11,490 roubles per tonne from 11,260 per tonne, IKAR said. SovEcon pegged it at 11,450 roubles per tonne, up 100 roubles.

Crude sunoil prices slightly strengthened to $1,120 per tonne from $1,094, IKAR said. SovEcon recorded them at 33,500 roubles per tonne, up 400 roubles.

Domestic white sugar prices were flat and stood at 25,700 roubles per tonne, IKAR said.

09.04.12

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