Russian wheat prices fell at the end of last week compared with the end of December due to lower global prices and renewed weakening of the rouble, Russian agricultural consultancy IKAR said on Monday. The Russian rouble continued to fall against the dollar since the start of the year along with crude oil, which dropped to a new 12-year low on concerns about China's economy.
Black Sea prices for Russian wheat with 12.5 percent protein content were at $184 a tonne on a free-on-board (FOB) basis at the end of last week, down $5 from the end of 2015, said Dmitry Rylko, the head of IKAR. European wheat futures were up at 171.50 euros ($187) at the end of last week to recover from a four-month low in step with a short-covering rally in Chicago.
Russia competes with countries such as France and Ukraine for wheat supplies to customers in North Africa and the Middle East. It is expected to get a large grain crop of more than 100 million tonnes for the third year in a row. Grain crops in Russia depend on weather patterns, but so far frosts in the central part of the country have not worsened the condition of winter grains, Rylko said. "The situation is not dramatic," he said. However, many winter grains remain in poor condition in Belgorod, Voronezh and Volgograd regions after they were affected by dry weather during autumn, he added.