Russian wheat prices rise with high demand

Export prices for Russian wheat rose last week as strong demand and growth in global benchmarks in Chicago outpaced improving prospects for this year's crop, analysts said on Monday. Egypt's state grains buyer GASC bought 180,000 tonnes of Russian wheat and 115,000 tonnes of Ukrainian wheat in a tender last week. Egypt is traditionally the largest buyer of Russian wheat.

Black Sea prices for Russian wheat with 12.5% protein content and for the nearest supply were up $4.5 to $199 per tonne on a free on board (FOB) basis at the end of last week, agricultural consultancy IKAR said in a note. SovEcon, another agricultural consultancy in Moscow, pegged wheat prices at $197.5 per tonne, up $3. Barley was unchanged at $179 a tonne.

IKAR said earlier on Monday it had raised its forecast for Russian wheat crop this year by 200,000 tonnes to 75.6 million tonnes. Russia's agriculture ministry last week raised its 2019 all grain crop forecast by 2 million tonnes to 120 million tonnes, including 78 million tonnes of wheat. Russia has exported 14.7 million tonnes of grain since the start of the 2019/20 season, 12% less than during the same period of the previous year, SovEcon said. That figure included 12.9 million tonnes of wheat.

Prices for third-class wheat in European parts of Russia rose 200 roubles to 10,525 roubles a tonne on the domestic market by the end of last week, SovEcon said. That price was on an ex-works basis, which excludes delivery costs. Russian farmers have already sown winter grains for next year's crop on 87% of the planned area or 15.2 million hectares. The delay in planting in Russia's south compared with a year ago has narrowed to 700,000 hectares from 900,000 hectares a week ago, SovEcon said, adding that weather conditions for winter crops remain close to multi-year average.

Sunflower seed prices fell further with the arrival of the new crop, sliding 1,525 roubles to 16,575 roubles a tonne, while domestic sunflower oil prices fell by 1,325 roubles to 43,000 roubles a tonne, SovEcon added. FOB export prices for sunflower oil for October shipment fell by $5 to $675 a tonne.