The Russian Agriculture Ministry has revised its estimate for this year's grain crop to 85 million tonnes from 88-90 million due to drought, but exportable surplus will remain at up to 20 million tonnes.

"Drought has hit Volga, Urals and Central federal districts with 12 regions declaring a state of emergency," Agriculture Minister Yelena Skrynnik said.

The three districts together account for about half of the total Russian grain crop.

But domestic grain consumption was estimated at 77 million tonnes and carry-over stocks of 24 million tonnes remain from two bumper crops in previous years, she said. This would leave the country with an exportable surplus of 20 million tonnes in the 2010/11 season.

Russia produced 108 million tonnes in 2008 and 97 million tonnes in 2009.

SovEcon Agricultural analysts lowered their 2010 grain crop forecast last week to 82-86 million tonnes from a previous 87 million and warned they may cut it further to 80 million tonnes if extreme heat persisted.

On Monday (Jul 5), the Institute for Agricultural Market Studies (IKAR) cut its crop forecast to 86-87 million tonnes.