May 29, 2012
Rain stabilises Russian wheat prices
Much-awaited rain in the South of Russian lessened the pressure on wheat prices last week, although scarce precipitation in Siberia and the Urals raise new concerns, analysts said.
Russia's state forecaster said the key southern agricultural regions saw overnight rains following a recent dry spell, with further rainfall expected this week.
"Rains in the South of Russia eased tension there last week, although dryness remains in a vast area of Voronezh, Volgograd, Saratov, Samara, Lipetsk, Tambov and Penza," The Institute for Agriculture Market Studies (IKAR) said.
Global wheat prices have risen in recent weeks on concerns that adverse weather in the world's top suppliers - the US, Russia and Australia are affecting output. Chicago wheat futures prices climbed more than 17% in the week to May 20, a record weekly gain in 16 years.
Deep water wheat export prices were at US$272-275 per tonne last week with limited market activity, IKAR said. SovEcon agricultural analysts said in a weekly note the purchase price of wheat with 11.5% protein content in Russian deep-water ports was flat last week and stood at RUB7,600-7,700 (approximately US$240) on a carriage-paid-to (CPT) basis.
Concerns over the new crop may switch to Urals and Siberian regions by the end of May because of a low level of moisture in the soil, it said.
From the start of the season till May 20, Russian wheat exports exceeded 20 million tonnes, while total Russian grain exports totalled 25.75 million tonnes, IKAR reported. It adds that preliminary prices for the new harvest were estimated at US$268-271 per tonne.
The domestic price index for sunseeds fell to US$436/tonne from US$449/tonne and decreased by RUB70 to RUB13,830/tonne. Crude sunoil prices were down to US$1,010/ tonne from US$1,145/tonne.