May 27, 2011
Kazakhstan to keep market share in Azerbaijan
Kazakh grain suppliers will seek the following season to maintain market share in Azerbaijan, its biggest export market for last year, after launching a trans-Caspian shipping connection and displace some wheat postponed by Russia's export prohibition.
An expected improvement on last year's drought-ravaged crop should also allow Kazakhstan to match or exceed the six million tonnes it intends to export in the current marketing year, traders and officials said.
However, cracking the traditional export markets served by Russia and Ukraine will be almost impossible for Kazakhstan should its ex-Soviet rivals resume Black Sea shipments from the new crop, as freight costs add too much to make Kazakh wheat competitive.
"If grain is being purchased at European destinations at a price of US$400 or more, then Kazakh grain is competitive. If not, then it is not," said a Kazakh trader.
He said Kazakh grain was now selling at about US$370 per tonne, free-on-board at Russian Black Sea ports. "But it needs to be super quality, so-called 'golden grain'," he added.
Kazakhstan, the world's seventh- or eighth-largest wheat exporter in a typical season, forecasts grain exports of six million tonnes in the current marketing year versus 8.4 million tonnes in the preceding season, the Agriculture Ministry said.
