Hot and dry weather will continue to dominate the Black Sea regions in August, increasing pressure on weak grains crop prospects in Russia and Ukraine, while rains in Kazakhstan are expected to aid its crop, forecasters said on Wednesday. Weather in the Black Sea producing countries, which normally supply a quarter of world wheat export volumes, has already hurt grain crops in Russia, Ukraine and Kazakhstan this year and has lent support to global wheat prices, which soared this summer.
Wheat prices have jumped about 50 percent since mid-June amid a severe drought in the US Midwest, dry conditions in Russia, Ukraine and Kazakhstan, excessively wet weather in Europe and a below average start to the Indian monsoon season. The USDA is expected to cut wheat crop estimates for Black Sea exporters as bad weather takes a toll, while it continues a trend of lowering figures for US corn and soy production, Barclays bank said on Tuesday. Temperatures will be higher than usual in Russia during August, putting pressure on crops, Russia's state forecaster said on Tuesday.
Most of the wheat has been harvested in the key southern exporting regions but spring wheat is still maturing to the north, and the outlook for corn is under threat from renewed hot weather in the breadbasket regions just north of the Black Sea coast. All key grain regions including Russia's South, Urals, Siberia and Volga, will see temperatures above normal levels, a map published by the State Hydrometeorology Agency showed.
A shortage of rains is likely in Russia's southern, Volga regions and in the Urals, while Siberia and a part of Kazakhstan will see an average level of precipitation. Russia, hit by severe drought first in the southern breadbasket regions and then in Siberia and Urals, could see a grains harvest of 75-80 million tonnes this year, down from last year's 94 million tonnes, top government officials said on Tuesday.
Its 2012/13 exportable surplus of wheat is seen in a range of 11 million tonnes to 15 million tonnes depending on the final 2012 crop, a government source told Reuters on Wednesday. Uncertainty over whether Russia will impose export constraints, as it did after a disastrous drought in 2010, have been another factor supporting grain prices in recent sessions.
Ukraine, which faced a record drought during the 2011 winter grain sowing, is likely to face searing temperatures of up to 42 degrees Celsius (107.6 Fahrenheit) in parts of the country in early August, which will hit its maize production, a state weather forecaster said on Wednesday.
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