November 29, 2010

Russian 2011 grain crop may reach 80 million tonnes

Russia is likely to reap 80 million tonnes of grain next year after a severe drought cut the country's output to 60.3 million tonnes in 2010 from 97 million in 2009 and 102 million in 2008, an analyst said Friday (Nov 26).

"The 2011 crop will be below average, but still better than this year after the drought. It will be around 80 million tonnes," said Andrei Sizov Sr., president and CEO of SovEcon agricultural analysts.

Russia's powerful grain lobby the Russian Grain Union has said that Russia needs 80 million tonnes of grain next year to be self-sufficient.

Sizov said that despite the delay in the winter grain planting campaign caused by the drought, abnormally warm weather in November has improved the state of winter crops in many producing regions.

The drought forced Russia to impose a ban on grain exports from August to July 2011. Analysts and officials have said the country would need to increase grain imports.

"At this moment domestic prices are lower than the international prices so there are no big volumes of imports to Russia. But we expect prices to rise sharply in January. This will stimulate imports to Russia from neighbouring countries, mainly Ukraine and to some extent Kazakhstan," Sizov said.