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Volga Baikal AGRO NEWS Update on the Russian Grain Price Development !!!
Export prices for Russian wheat went up. The reason is the delay in customs clearance of deliveries and the recent jump in prices on world sites.
From the beginning of the season up to December 17, 2020, Russia shipped 26.2 million tons of grain to foreign markets.
Export prices for Russian wheat last week rose amid delays in customs clearance of deliveries and following a jump in prices on global markets earlier, Reuters reported. According to the Institute for Agricultural Market Studies (IKAR), by the end of last week the price of wheat with 12.5% protein for January delivery increased from $ 252 / t up to $ 257 / t (FOB Novorossiysk). Analytical center “SovEcon” estimates an increase by $ 2: up to $ 259 / t. Refinitiv for the week recorded an increase from $ 253 to $ 255 per ton. General Director of IKAR Dmitry Rylko notes that the price of wheat for the February delivery is expected at $ 260 per ton FOB.
According to analysts of SovEkon wheat export forecast will soon be revised and reduced by 2-3 million tons from the current 40.8 million tons. IKAR has already adjusted its forecast, reducing it from 40 million tons to 37.5 million tons, Rylko told to Interfax. “This is due to a combination of two factors: government regulation of exports and the expectation of a lower harvest due to unfavorable weather conditions for winter crops,” he explained. The expert also spoke about the impact of the export duty on wheat. “Out of the $ 30 of its equivalent, about $ 10 is taken over by the world market in the form of an increase in Russian export prices,” Rylko explained. “Another $ 20 is ‘offered’ for absorption by our market in the form of lower domestic prices within the vertical supply chain.” These data will change over the course of the season, he said.
In addition, last week traders faced delays in obtaining customs documents for export, problems with the registration of grain for shipment by rail to the ports of the Baltic States, as well as the deterioration of the situation with the acceptance of wheat for transportation to the south. Rylko told to Agroinvestor: ”That there were questions about the weight of the product and, if the customs requirements were formally met, the goods would have to be unloaded and weighed again, which could be a disaster for exporters. True, then these were not massive cases, industry analysts specified.
Also last week, the government announced restrictive measures on the export of grain, wheat and sunflower, promising to consider similar ones for sunflower oil, and it is also planned to introduce an export duty on soybeans. “SovEcon” notes that against the background of this news, the domestic market experienced a shock, but now farmers are gradually returning to sales, focusing on new price levels. Last week the price of 3rd grade wheat fell by 625 rubles. up to 15.1 thousand rubles. per ton, 4th class – by 675 rubles. up to 15 rubles. per ton with self-delivery for the European part of Russia.
