June 29, 2012
Russia, Ukraine, Kazakhstan total wheat crops to fall 22%
The black Sea wheat powerhouse of Russia, Ukraine and Kazakhstan's combined wheat crop will fall to 78.9 million tonnes this year, down 22% from 2011, a Reuters poll of 19 traders and analysts showed.
Global wheat markets anticipate a decline in shipments from the black sea region which supplies around a quarter of world wheat export volumes, with the biggest impact on yields from winterkill and spring drought in Russia and Ukraine. Reduced crop prospects in the Black Sea region has coincided with a sharp deterioration in the outlook for the US corn crop to help spark a sharp rise in grain prices.
Several analysts said wheat exports from the Black Sea countries could fall by around a quarter in the marketing season of 2012/13 to reach about 30 million tonnes.
SovEcon agricultural analysts said they expected Russia to cut 2012/13 wheat exports by 10 million tonnes, falling to 11 million tonnes of wheat.
However, Ukraine Agriculture Minister Mykola Prysyazhnyuk said high stocks could help Ukraine to export a record 22-27 million tonnes of grain in the 2012/13 season, including 5 million tonnes of wheat, which usually accounts more than 90% of Kazakhstan's grain exports.
The drought is a key contributor to a deficit of wheat forecast this year on the world market, seen by the USDA and the International Grains Council at about 10 million tonnes, Commerzbank noted in a research report.
"US output should admittedly increase 12% following a poor harvest (in 2011), but a smaller harvest in the Black Sea region, in particular in Ukraine and Kazakhstan, the European Union and Australia will outweigh the increase."
Russia's median wheat crop forecast stood at 50.5 million tonnes, down from last year's 56.2 million tonnes, while over a third of respondents saw Russia's wheat crop below 50 million tonnes. The poll suggests that Russia, which returned as the world No. 3 wheat exporter after 2010's drought, will decrease its grain harvest to 85.5 million tonnes from 94 million tonnes.
The lowest estimate was presented by Russia's Agriculture Ministry, which made a long expected reduction in its outlook on Monday, forecasting 47.5 million tonnes of wheat.
Ukraine's grain crop is expected to fall to 44.9 million tonnes, of which wheat can account for 13.6 million tonnes.
Hardest hit is Kazakhstan, expected to harvest 16.6 million tonnes of grain, down from 27 million tonnes in 2011, of which wheat may account for 14.8 million tonnes. However, it may still sustain record exports this year with help from high stocks.