December 21, 2007

Russia's November grain exports decline

Grain exports by Russia slid in November to 2 million tonnes from a record 3.2 million tonnes in October due to a shortage of railway cars and bad weather on the Black and Azov seas, which disrupted loading at ports. The country exported a total of 10.2 million tonnes of grain in July-November.

The market expects the government to stop exports of wheat, when total shipments of wheat and barley reach 12.5 million tonnes, thus, diminishing the number of exporters. Russian agri-stat SovEcon expects exports to fall to 1.4 to 1.6 million tonnes in December and to 0.9 to 1.2 million in January and the restrictions to be introduced from the beginning of February.

A 10 percent export tariff set from November 12 had little influence on exports, which together with wheat flour, reached 9.06 million tonnes. A 30 percent tariff on barley cut exports of the cereal drastically in November. Flour exports in November reached an absolute monthly record of 53,000 tonnes.

Shipments totalled 129,000 tonnes, or 184,000 tonnes in grain equivalent, since the start of the season in July, compared to 166,000 in the whole of 2006/2007 crop year.

Shipments of flour from the Siberian Altai region to the Central Asia, mainly Tajikistan, accounted for the bulk of the increase. Exports of rye, which are not liable to export tariffs, reached 91,200 tonnes in July-November, compared to just 23,800 tonnes in the whole of 2006/07.

SovEcon expects flour and rye exports to remain high, and total grain exports, including wheat, to exceed 13 million tonnes in 2007/08.