Russian wheat export prices flat due to stronger rouble -analyst

18.04.2017

Russian wheat export prices were flat last week, supported by a 1.6 percent rise in the rouble against the dollar, Russian agriculture consultancy IKAR said.

Black Sea prices for Russian wheat with 12.5 percent protein content for April delivery were $188 a tonne on a free-on-board (FOB) basis at the end of last week, unchanged from a week earlier, according to IKAR.

SovEcon, another Moscow-based consultancy, quoted FOB maize (corn) prices down $2 to $175 per tonne, it said.

Russia is expected to reduce grain exports to 3.1 million tonnes in April due to lower supplies to Turkey, the second top buyer of Russian wheat after Egypt, which has effectively put purchases of wheat, maize (corn) and sunflower from Russia on hold by imposing high import tariffs.

Russian Deputy Prime Minister Arkady Dvorkovich, the government official responsible for agriculture, will meet his Turkish counterpart Mehmet Simsek in Moscow on Tuesday.

Russia exported 29.3 million tonnes of grain, including 22.6 million tonnes of wheat, between July 1 and April 13, the agriculture ministry said, down 0.5 percent year-on-year.

In the domestic market, high stockpiles, the stronger rouble and the approaching end of the season, which runs until June 30, continue to put pressure on grain prices, SovEcon said.

Domestic prices for third-class wheat fell 100 roubles compared with the week earlier to 9,600 roubles ($171) a tonne in the European part of Russia on an ex-works basis. Ex-works supply does not include delivery costs.

As of April 14, farmers have already sown spring grains on 7.9 percent of the planned area, or on 2.4 million hectares, compared with 2.5 million hectares a year ago, according to the agriculture ministry.

The ministry sees a 2017 grain crop of at least 110 million tonnes, while SovEcon expects it at 113 million tones, including 69 million tonnes of wheat.

Prices for Russian sunflower oil have also been under pressure due to reduced supplies to Turkey, SovEcon said. Some traders have started supplying Russian sunflower oil to India but large sales were unlikely, it said.

Sunflower seed prices fell 650 roubles to 17,350 roubles per tonne, SovEcon said, while domestic sunflower oil prices fell 1,325 roubles to 40,250 roubles and export oil prices were down $10 to $695 per tonne.


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