August 16, 2011

Russian grain production forecast decreases

Although SovEcon has decreased Russia's harvest forecast to 87-90 million tonnes, it has increased its 2011/12 export forecast by two million tonnes to 20 million tonnes because of record volumes at the beginning of the season.

SovEcon said this year's harvesting progress reports should be compared with those of 2009 rather than 2010, when the country was hit by a severe drought and farmers managed to reap a meagre 61 million tonnes of grain.

The yields in the south of Russia are higher than in 2009, but they are declining as the harvesting campaign moves north and eastwards.

As the harvesting area is some four million hectares down from 2009 and average yields are expected to be in the region of two tonnes per hectare, the crop is likely to decline by around eight million tonnes from the 97 million tonnes reaped in 2009.

Therefore, expectations of a crop above 90 million tonnes appear to be too optimistic.

Russia's official 2011 grain crop forecast is 85-90 million tonnes. The Institute for Agricultural Market Studies (IKAR) analysts believed the crop may be 91-92 million tonnes.