September 23, 2010

Russia's gross grain crop shows 32% decrease

Russia harvested 55 million tonnes of grain in bunker weight by September 22, an on-year decrease of 32%, according to the Agriculture Ministry.

Russia's worst drought in more than a century has sparked a rally in global grain markets, pushing wheat prices to their highest level in two years in August after Moscow banned exports of the commodity.

The ministry said in a statement drought had killed grains on over 13 million hectares, or 30% of the total area sown with grains for this year harvest.

Grains had been threshed on 29 million hectares, or 82% of the total harvesting area by September 22, the statement said. It did not provide a comparison to a year-ago indicators.

By September 23 last year, farmers had harvested 81.4 million tonnes of grain from 33.4 million hectares, or 73% of the total harvesting area.

Average yields declined this year to 1.91 tonnes per hectare from 2.44 tonnes per hectare a year ago. Russia expects to harvest a little more than 60 million tonnes of grain this year by clean weight, down from 97 million in 2009.

Bunker weight in the last several years averaged 6% higher than clean weight, obtained after grain has been cleaned and dried. But the difference can be smaller in hot and dry years like this one.

Global wheat production looks set to fall this year, but a rise in stocks following the two largest wheat harvests in history in 2008 and 2009 should help keep a lid on prices.

The ministry data showed the winter sowing campaign was accelerating. Farmers had sown 8.4 million hectares with winter grains by September 22, down from 11.5 million hectares by September 23, 2009.

A week ago farmers had sown 5.8 million hectares with winter grains, less than half of the area of a year before. Russia aims to sow 15 million hectares with winter grains for the 2011 crop, down from 18 million last year.