November 2, 2023

Russian wheat prices stabilise amid sluggish demand and decreasing supply

Russian wheat export prices remained steady over the past week as demand from international buyers continued to be subdued, while wheat supplies from farmers decreased as a result of a prolonged price slump, Nasdaq reported.

The price of 12.5%-protein Russian wheat designated for free-on-board (FOB) delivery in late November to early December held at US$224 per metric tonne last week, reported the IKAR agriculture consultancy. In parallel, the Sovecon agriculture consultancy noted the price for the same class of wheat at US$228-234 per ton FOB last week, marking a US$1 decrease from the previous week.

Despite the competitive pricing of Russian grain, demand from buyers has been restrained, according to Sovecon's weekly report.

Russian grain exports remained steady at 1.08 million tonnes last week, similar to the previous week. These exports included 0.99 million tonnes of wheat, compared to 0.94 million tonnes in the previous week. This information is based on port data and was reported by Sovecon.

Sovecon's estimate for wheat exports in October was adjusted upward by 0.2 million tonnes compared to the previous week, reaching 4.4 million tonnes. This figure is in comparison to 4.5 million tonnes from the same period last year and the historical average of 4.1 million tonnes.

Last week, the Ministry of Agriculture of the Russian Federation increased its grain harvest and export forecasts. The wheat harvest as of October 26 totalled 93.6 million tonnes, a decrease from the 104.5 million tonnes harvested a year earlier. The reduction in harvest quantity is attributed to a decrease in planted hectares, with 28.8 million hectares compared to the previous year's 29.2 million hectares. The average yield came in at 3.25 tonnes per hectare, down from 3.58 tonnes per hectare from the previous year.

Sovecon reported that winter grain sowing was carried out on an area covering 17.5 million hectares, an increase from the 16.6 million hectares the previous year.

-      Nasdaq