Russia seen to reap lesser grain; more oilseeds

Due to high winterkill damages and lower yields, Russia will harvest lesser grain this year than previously, but may have a record crop of oilseeds, according to Russian analysts on Thursday (May 27).

SovEcon now expects Russia to harvest 87 million tonnes of grain this year, 10 million tonnes less than the country harvested a year ago and one million tonnes less than SovEcon initially expected.

This is below the official Agriculture Ministry's forecast of 97 million tonnes and the Russian Grain Union lobby group's forecast of 100 million tonnes.

SovEcon said that although its estimate for the total area to be sown with grains for the 2010 crop of 45.65 million hectares is close to official estimates, it expects lower yields as farmers will use less inputs because of the crisis.

The wheat crop is expected to fall to 55.5 million tonnes from 61.7 million in 2009 and the barley crop to 16 million tonnes from 17.9 million.

Analysts estimate grain exports in the 2010-11 crop year to shrink to 18-19 million tonnes from 20.5 million expected in the current 2009-10 season, and wheat exports to fall to 16-17 million tonnes from 17.7 million.

A decline in the barley crop will not only result in a fall in exports to 1-1.5 million tonnes in 2010-11 from 2.4 million, but may cause a domestic shortage. This could also raise domestic demand for feed wheat, pushing prices up, analysts said.

Meanwhile, analysts said that the country may increase the area to be sown with soy and rapeseeds. The soy crop may therefore rise to a record 1.1 million tonnes from 950,000 and rapeseed to 770,000-800,000 tonnes from 730,000 tonnes.

Therefore, total oilseed production in Russia may reach a record 9.4 million tonnes, up from 8.2 million tonnes in 2009, analysts said.