IKAR in Mass and Industry Media

Russian grain prices stable or slightly down

Reuters

MOSCOW, April 14 (Reuters) - Russian domestic grain prices were either stable last week or declined slightly, leading analysts to forecast the start of a downward trend ahead of the new crop.

"It looks like the upward trend, which raised most grain prices by some 40 to 50 percent between January and April, is coming to an end," SovEcon agricultural analysts said.

"After many months of a price rally, the domestic grain market has turned towards a declining trend, although the number and volume of transactions are limited," the Institute for Agricultural Market Studies (IKAR) said.

IKAR said that, in the Central Black Soil Region, third-grade milling wheat lost $5 last week, sliding to $405 per tonne. Fourth-grade declined by $4 to $381 per tonne and fifth-grade feed wheat decreased by $3 to $363 per tonne.

Feed barley, which has been heavily undervalued in comparison with feed wheat, remained unchanged at $328 per tonne, it said.

SovEcon also noted a decline in certain cereals prices, mainly milling wheat, in the European part of Russia. But, it said, milling rye added 150 roubles ($6.39). "Most buyers were trying to keep prices stable, under levels offered by sellers. However, some offer prices were down, as some farmers in need of funding for the spring sowing campaign have started selling their stocks," SovEcon said.

"Some stock holders still refrain from selling, betting on higher prices in a month or two when processors' stocks decline and demand increases," it added.

SovEcon said grain prices in Siberia were stable last week.

It said the rise of the flour price appeared to slow down to an average of 150 roubles per tonne.

Sunseed prices rose to $980 per tonne ex-factory after the unexpected decision of a major processor to increase sunseed purchases, although the market has been very thin, IKAR said.

Sunoil crude prices remained unchanged in a range of $2,100-$2,120 per tonne. Traders reported high volumes of palm oil imports, IKAR said.

White sugar prices declined despite very low domestic stocks, probably due to low seasonal demand. The decline raises doubts about the possibility of a price rally, expected by some traders in April-May.

12.05.08

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