September 6, 2011


Russia's wheat prices go up, barley declines



Russian wheat prices rose continuously in the European part of Russia as exporters' demand resembled closely to competitors whereas barley prices slipped slightly amid lower demand and soaring supply, according to analysts on Monday (Sep 5).


Third- and fourth-grade milling wheat added RUB325 (US$11) to RUB6,150 (US$208.46) and RUB6,100 (US$206.76) per tonne Ex Works (EXW), while feed wheat rose by RUB450 (US$15.25) to RUB5,200 (US$176.26) per tonne, SovEcon agricultural analysts said in a weekly note.


Exporters' demand also pushed rye prices up by RUB400 (US$13.56) to RUB4,150 (US$140.67) per tonne, it said.


The only cereal which declined, although by just RUB25 (US$0.85) per tonne to RUB5,650 roubles (US$ 191.51), was barley due to lower demand from exporters and rising new crop barley supply.


Ex Works prices were stable in the Urals and Siberia as the grain harvesting campaign was gaining momentum in those parts of Russia.


SovEcon said prices of grain from the Urals and Siberia, praised for its quality and absence of pests, may still rise especially if plans by the government to lower railway fees to export ports materialise.


CPT (Carriage Paid To) prices at ports rose last week, SovEcon said. Traders bid for fourth-grade wheat at RUB7,300-7,500 (US$247.44–254.22) per tonne, up from RUB7,000 (US$237.3) a week before. Bids for the cereal at shallow water ports are at RUB6,300-6,400 per tonne (US$213.54-216.93).

Traders say exports began via Baltic sea ports, SovEcon said.


The FOB Black Sea price for ordinary milling wheat with 11.5% protein content rose to US$295 per tonne from US$290, the Institute for Agricultural Market Studies (IKAR) said in a separate note.


"Russia remains the cheapest supplier of ordinary milling wheat to the regional market, although last week the spread with the European wheat minimised," it said.


Under preliminary estimates, August grain exports amounted 3.2 million tonnes, which together with 2.5 million tonnes of July exports total 5.7 million tonnes, which is close to the record high two-month exports in 2009/10 of 5.8 million, IKAR said.

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