June 3, 2008

 

Russian wheat prices drop on entry of new crop

    

  

Russia's wheat prices fell by more than US$25 last week to trim the gap with forward export prices set for the new crop in July.

 

Market analysts said more cuts are expected this week.

 

Grain producers in southern Russia started selling their old stocks and conceded to price cuts on most types of grain due to weak demand, SoyEcon said.

 

Grain prices lost an average RUB150 to RUB400 a tonne in the last week, compared with RUB50-200 a week earlier, SovEcon pointed out.

 

Fourth-grade wheat saw the biggest losses, falling RUB500.

 

The Institute for Agricultural Market Studies (IKAR) said that domestic prices expect further dramatic shrinkage to match start-up export prices of the new harvest.

 

IKAR said domestic prices for third-grade wheat had declined US$25 in the last week to US$343 per tonne.

 

Fourth-grade wheat fell US$27 to US$328 per tonne and fifth-grade by US$25 to US$320 per tonne.

 

Meanwhile, a similar trend has emerged on oilseed markets, with producers ridding themselves of stocks.

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