Russia needs to find new markets for its grain exports and speed up its supplies abroad to ease pressure on the domestic market after a record crop of 119 million tonnes in 2016, the SovEcon agriculture consultancy said in a note. Customs data shows Russia's December grain exports fell to 3.18 million tonnes from 4.05 million tonnes in November due to storms in ports and the rouble strengthening against the dollar.
In January, Russia's grain exports are expected to fall to 2.4 million tonnes, including 1.8-1.9 million tonnes of wheat, 300,000-400,000 tonnes of maize (corn) and 100,000-150,000 tonnes of barley.
This will bring Russia's grain exports to 23 million tonnes for the period between July and January, slightly up on the same period a year ago.
"Nevertheless, it is not enough to not to stay with record stocks of grain at the end of the season, which may significantly cut domestic prices not only for the last year's crop but also for the new crop."
To avoid this, Russia needs to keep exports at 2.8 million tonnes of grain per month between January and June 2017, it added.
"This task is difficult, if reachable at all," SovEcon said. Russia's traditional markets of North Africa and the Middle East will not be able to consume such amounts of grain and will be buying less wheat from Russia starting from March.
Hopes of large supplies of Russian wheat to Asia did not materialise in December, with Bangladesh, the largest buyer of Russian wheat in the region, reducing purchases for the third consecutive month.
Russia has started sending wheat to China but has shipped only 300 tonnes to the country so far, SovEcon added.
Exports of maize (corn) have also slowed in December as supplies to South Korea fell significantly. Iran, the largest buyer of Russian maize so far this season, is expected to reduce purchases via shallow-water ports in winter months.
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