Grain stocks in Russia, one of the world's largest wheat exporters, are expected to hit their lowest level in six years by the end of the 2018/19 marketing season on June 30, the SovEcon consultancy said in a note on Thursday. Russia's wheat crop has been hit this year as a dry spring and summer ended five years of plenty in many wheat-producing regions and drew down reserves of major exporters to their lowest level since 2007/08, when low stocks contributed to food riots across Africa and Asia.
SovEcon, one of the leading agriculture consultancies in Moscow, said it downgraded its estimate of 2018/19 ending stocks to 10.1 million tonnes from a previously expected 13.2 million tonnes after cutting its forecast for Russia's 2018 grain crop by 4.3 million tonnes to 109.6 million tonnes.
"The parameters of (the supply and demand) balance may undergo significant changes if there are curbs on grain exports," SovEcon said, referring to a meeting between Russia's agriculture ministry and grain traders last week to discuss export volumes.
The ministry denied that export limits were discussed, but traders - some of whom were at the meeting - said that curbs might be imposed later in the season after complaints from domestic meat producers about the rising cost of animal feed.
The agriculture minister later said there was no reason for a wheat export duty for now, though some exporters expect that curbs on exports could be implemented after December.
The smaller Russian harvest is coinciding with rising global wheat prices and a continuing weakening of the rouble, which usually speeds up commodity exports. The rouble hit its lowest since April 2016 on Thursday, pricing in risks of more US sanctions.
Comments
Comments are closed.