Russian wheat export prices down

Russian wheat export prices declined last week tracking weaker European wheat futures and shrugging off a new wheat export tax, analysts said. Russia, a leading wheat exporter to North Africa and the Middle East, will impose its new wheat export tax on July 1, a move traders say could threaten profits on advance contracts if the rouble weakens in the coming months.
Black Sea forward prices for Russian new crop wheat with 12.5 percent protein content stood at $190 per tonne on a free-on-board (FOB) basis at the end of last week, down $4 from a week earlier, the IKAR agriculture consultancy said. Russian wheat won the major part of a state tender by Egypt, the world's largest wheat importer, with the FOB price of around $191 per tonne on Thursday. Russia has exported record 30 million tonnes of grains, including 21.3 million tonnes of wheat, since the start of 2014/15 marketing year on July 1, IKAR said. Its data includes an estimated 700,000 tonnes of wheat exports to Kazakhstan. According to its forecast, Russia's wheat exports for 2014/15 may reach a new record and exceed 22 million tonnes.
On the supply side, the Agriculture Ministry said last week the country was on track to harvest 100 million tonnes of grains this year, down 5 million tonnes from a near-record level in 2014. However, SovEcon consultancy sees the 2015 grain crop at 95 million tonnes, including 54 million tonnes of wheat, it said in a note. Its estimate includes the Crimean peninsula annexed by Russia from Ukraine in 2014.
IKAR has upgraded its 2015 wheat crop forecast by 1 million tonnes to 55-60 million tonnes, excluding Crimea, it said. Russian farmers have sown 24.7 million hectares with spring grains as of May 28, down 2.3 million hectares from a year ago. Domestic prices for third-class wheat were up 75 roubles compared with a week earlier at 9,325 roubles ($177) per tonne in the European part of Russia on an ex-works basis, SovEcon added.
In the domestic sunflower seed market, SovEcon said prices were flat at 20,475 roubles per tonne, while FOB Black Sea prices for crude sunflower oil remained at $820-840 per tonne. IKAR's white sugar price index for Russia's south was at $717 per tonne, down $44 from a week ago.