July 10, 2010
Forecast for Russia's grain drops due to severe drought
SovEcon sharply cut its forecast for Russia's 2010 grain crop on Friday (July 9) from 82-86 million to 77-81 million tonnes, as a severe drought persisted in key producing regions.
SovEcon said the wheat crop this year may fall to 49-51 million tonnes from 61.7 million in 2009 and barley crop to 12-14 million tonnes from 17.9 million tonnes last year.
The official Russian grain output forecast for this year is 85 million tonnes, down from the 97 million tonnes Russia harvested in 2009.
SovEcon believes that a dramatic decline in output will block government plans to subsidise exports. Huge government stocks will be needed as soon as autumn, when a shortage of grain, especially feed grain, will be expected in some regions.
Shortage of barley, consumption of which has ranged between 15-17 million tonnes in the last few years, will boost demand for feed wheat and cut exports drastically.
Abnormally hot and dry weather has persisted in Russia's key producing regions along the Volga region in the Urals and in central Russia in the last few weeks and is expected to continue in the next seven to eight days.
In the regions along the Volga river the temperatures ranged between 33-40 degrees Celsius (86-104 degrees Fahrenheit) and were accompanied by hot and dry winds, which dried the soil and caused the fall of grain.
In some parts of this zone, soil drought is estimated to have hit between 40-60% of the total sown area, on which a decline in yields is already irreversible even if rains begin in the next few days there.
Insufficient soil moisture was felt in the southern part of the Ural mountains and in the southwestern part of Siberia. SovEcon expects crops to fall in Siberia and the Urals.
Soil drought has also hit the centre and the south of Russia. The south of the country is expected to be less affected by drought than other regions. But rains there are delaying the harvesting of winter wheat.
