Volga Baikal AGRO NEWS Update on the Russian Exports !!!

Global demand for Russian grain remains high

Volga Baikal AGRO NEWS Update on the Russian Exports !!!

The US Department of Agriculture has kept the forecast of wheat exports from Russia.

The agency’s estimate for this season is 39 million tons.

USDA Foreign Agricultural Service (FAS USDA) kept the forecast for wheat exports from Russia in the current agricultural year at the January level – 39 million tons, according to the department’s February report. The forecast for the closest pursuers in terms of export volume – the United States remained unchanged (27 million tons), for the EU countries (including Great Britain) – increased by 0.5 million tons to 27 million tons. The forecast for the export of feed grain from Russia was slightly increased – from 8 , 68 million tons to 8.69 million tons, including the export of corn is estimated at 3.1 million tons.

Head of the Union of Grain Exporters Eduard Zernin told to Agroinvestor that he is not surprised that, despite the introduction of duties by Russia, the US Department of Agriculture did not change the forecast for the export of Russian wheat. “The USDA is a conservative forecaster; they live on facts, not feelings. I think they will wait for the introduction of duties and will monitor the pace of exports in the new regulatory environment. In case of serious deviations, it is possible that they will adjust their forecast. By the way, this coincides with our expectations, “he commented. According to Zernin, the state of the world market now speaks of maintaining a high demand for Russian grain, so there are no fundamental grounds for adjusting export indicators so far. “We expect certain operational difficulties at the start of the duties, it will take time to optimize business processes and workflow, but these are temporary difficulties. Our exporters are determined to choose their quotas for the second half of the season, ”Zernin said.

Given that the Russian quota of 17.5 million tons from February 15 until the end of the season and duties on grain export are in effect for deliveries outside the EAEU, it is likely that exporters will look for some kind of workaround to export products outside the Union. admits the president of the Russian Grain Union (RZS) Arkady Zlochevsky. “However, this is still a loss of money in the economy,” he stressed. Zernin believes that large volumes of grain will not be shipped under such violations. “At least due to the logistical difficulties that entail higher prices for grain. Taking into account that [from June 2] the duty will be floating, it will be extremely difficult to predict its benefit from such violations,” – he explained.

Zlochevsky believes that the US Department of Agriculture having left the forecast for Russia unchanged, it apparently expects that either the external market will win back the price of the duty, or Russia will “ram” the domestic market to the limits of competitiveness in export operations, and export will continue. “And the quota of 17.5 million tons is generally enough to make all forecasts come true,” he said. Earlier, Zlochevsky said that restrictions on grain exports by Russia frighten buyers, and this leads to an increase in prices on the world grain market. He noted that if at the beginning of the season Russian wheat was sold at a price of $ 220 per ton (FOB), now the price is about $ 285 / ton.

From the beginning of the 2020/21 season to February 4, Russia supplied 32.6 million tons of grain to foreign markets, which is 25% more than the same period of the previous agricultural year. Including export of wheat amounted to 28 million tons, which is 25% more than last season, barley – 3.4 million tons, or 48% more, corn – 1.1 million tons, or 12% less.

08 February, 2021 RZS announced an appeal to President Vladimir Putin with a request not to support tightening restrictions on grain exports from Russia. The union also asked to limit the action of the measures already introduced in the current agricultural season and compensate for part of the drop in income of agricultural producers. In the long term, the new measures will lead to a drop in the income of wheat producers by 4-4.5 thousand rubles. per ton, estimated RZS. The authors of the appeal believe that this will lead to stagnation of production, an increase in its dependence on natural and climatic phenomena, and will form qualitatively new risks for the agro-industrial complex and food security of the country.

Source: Agroinvestor.ru

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