March 16, 2006

Russia's grain output to fall below country's requirements

Russia's grain production may not be enough to cover the country's needs this year due to high winterkill losses. Production may fall to 66-71.5 million tonnes this year from 78 million tonnes in 2005, Andrei Sizov of SovEcon agricultural analysts said.

Winter grain plantings in many regions were weak and Russia is experiencing a late spring this year, thus resulting in high losses, said Andrei Sizov of SovEcon agricultural analysts.

SovEcon expects winter grain output to decline by some 10 million tonnes this year to 24.25 million tonnes.

Winter wheat output is expected to fall to 19-21 million tonnes from 28.95 million in 2005. Winter grain harvesting area is expected to fall this year by some 20 percent to 10.6 million hectares from 13.19 million a year ago.

On Monday, Agriculture Minister Alexei Gordeyev put his estimate of winterkill losses to 25 percent of the area sown to winter grains for the 2006 crop.

Sizov also dismissed market speculation that winterkill losses may be compensated for by the spring sowing, saying that Russia has insufficient agricultural machinery and late spring is likely to cut the sowing and the harvesting period.

In addition, low soil moisture content in Western Siberia and the Urals, the main spring grains sowing regions, may result in lower yields and output.

With 66.0-71.5 million tonnes, Russia will not have enough grain for domestic consumption and supplies will be very tight, Sizov said.