Russian wheat export prices ended higher for the fifth week running as increased inspections by the agriculture safety watchdog unnerved the market, analysts said on Monday. The watchdog, Rosselkhoznadzor, has been beefing up quality controls in recent weeks. Traders watch closely for any changes to regulations because such moves have been used in the past to place informal curbs on exports.
Black Sea prices for Russian wheat with 12.5 percent protein content and for delivery in October were $232 per tonne on a free on board (FOB) basis at the end of last week, up from $228 a week earlier, Russian agricultural consultancy IKAR said in a note. SovEcon, another Moscow-based consultancy, quoted FOB wheat prices up $1 at $230 a tonne, while barley was up $2 at $234 a tonne.
Rosselkhoznadzor said last week that it would inspect grain loadings at ports across Russia due to complaints from major buyers about falling crop standards. "We expect the agency to continue unnerving the market in the near future," SovEcon analysts wrote. "However, at the moment we continue to believe that we are not talking about a major campaign to close grain terminals," SovEcon said.
On Thursday, SovEcon upgraded its forecast for Russia's 2018 grain crop by 700,000 tonnes to 109 million tonnes. IKAR also raised its total grain crop estimate for Russia on Monday, to 110.5 million tonnes from 109.3 million tonnes.
Russian farmers had harvested 108.7 million tonnes of grain by Oct. 12 from 95 percent of the harvesting area, data from the Agriculture Ministry showed. As of Oct. 11, Russia, one of the world's largest grain exporters, had exported 16.7 million tonnes of grain since the start of the 2018/19 season on July 1, SovEcon said. That was up 24 percent compared to the same period the previous year and included 14.4 million tonnes of wheat.
Sunflower seed prices fell by 650 roubles to 18,475 roubles a tonne, SovEcon said. Export sunflower oil prices were down by $5 at $660 per tonne, the agency said. IKAR's white sugar price index for southern Russia was at $539 a tonne on Oct. 12, down $15 from a week earlier.
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