December 29, 2009


Russia grain prices stable on quiet trade



Russian grain prices showed no clear trend last week in quiet trade ahead of the long holiday and stormy weather at key export ports.


Ordinary milling wheat with bug damage of 1% lost around US$2 per tonne, declining to an estimated US$190 per tonne FOB Novorossiisk, the Institute for Agricultural Market Studies (IKAR) said.


Ordinary milling wheat with bug damage of 1.5% also declined US$2 to an estimated US$183 per tonne. Feed barley was stable at US$130 per tonne. High quality wheat with 13.5% protein was estimated at US$170 per tonne at Azov ports.


SovEcon agricultural analysts said average domestic feed wheat prices rose by RUB50 (US$1.7) per tonne to RUB3,125 (US$105) per tonne, while feed barley increased RUB100 (US$3.36) to RUB2,475 (US$83.2) per tonne.


Market players said exporters preferred Siberian wheat that was not damaged by bugs.


Grain exports in the first 20 days of December exceeded 1.1 million tonnes compared to 1.16 million tonnes a year ago, as volumes declined in the last two weeks due to bad weather in the Black and Azov seas region, IKAR said.


It said that the government's plans to start massive grain exports from intervention stocks could damage the vulnerable Russian export prices. But SovEcon said that it did not expect exports to start immediately and did not believe volumes would be high.


Sunseed purchase prices rose to US$447 per tonne from US$417, soy to US$517 from US$509 and rapeseed to US$367 from US$345, IKAR said.


Both SovEcon and IKAR believe that the market looks overheated and that cooling is inevitable.

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