Volga Baikal AGRO NEWS Update on the World Wheat Prices !!!
At the moment, world wheat prices are at a high level, but the global food price index has already gone down due to lower prices for sugar and milk.
Meanwhile, the US Department of Agriculture raises forecasts for wheat and grain exports from the Russian Federation. The US department raised the forecast of wheat exports from Russia in the new agricultural year (July 2022 – June 2023) by 1 million tons – up to 40 million tons in total. The volume of exports from the European Union, American officials predict at the level of 36 million tons. Wheat production in Russia is projected at 81 million tons against 80 million tons according to the May forecast. The estimate of rolling stocks as of July 1, 2023 has not changed and amounts to 11.4 million tons.
As explained in the review, the assessment of wheat harvest in the Russian Federation has been increased taking into account the increase in winter crops and favorable weather conditions. The forecast for exports of 40 million tons may become the second largest indicator in the entire history of observations.
The Russian Institute of Agricultural Market Conjuncture has raised its baseline forecast for wheat harvest in Russia this year by 2 million tons, to 87 million tons. “We have a wide fork in estimates – from 84 to 90 million tons. But the base forecast is now 87 million tons against the previous one of 85 million tons,” – said Dmitry Rylko, CEO of the Russian Institute of Agricultural Market Conjuncture.
According to him, the increase is due to the fact that the acreage under spring wheat will be larger than expected. “In addition, the weather in the Urals and Siberia has stabilized. There was a threat there, but it has passed for the coming weeks,” – Rylko said. – And favorable weather conditions are developing for the center and the Volga region. All this has seriously increased the assessment of the harvest and levels the reduction of the harvest in the south.” As Rylko explained, ICARUS lowered the assessment of wheat harvest in two southern federal districts mainly due to the fact that dry winds have been blowing there for two weeks. “And, according to forecasts, it will blow for several more days. This is very bad for crops,” he explained. The forecast of the ICARUS grain harvest in Russia as a whole increased by 2 million tons, to 133.5 million tons. Rylko also said that the assessment of the export potential of the Russian Federation for wheat for the new agricultural year increased to 41 million tons against the previous 39 million tons.
According to FAO, the overall global food price index has been declining for two months in a row. Although the prices themselves are noticeably higher than last year. Recall that the global rise in food prices began long before the Ukrainian crisis and was associated with the pandemic and monetary stimulation of the largest economies. The main factors in the decline in the FAO price index in May were the price indices for vegetable oils and dairy products, and the sugar price index also decreased. At the same time, grain and meat price indices have increased.
And although US wheat futures are relatively stable in June, the FAO says prices have risen for the fourth month in a row. “This sharp increase in wheat prices is due to the export ban imposed by India due to concerns about the state of crops in a number of leading exporting countries, as well as a decrease in expected production volumes in Ukraine,” – FAO experts report.