Agriculture • Grain exports from dryness-hit Russia to fall 28%
Grain exports from dryness-hit Russia to fall 28%
Russia’s grain exports could fall by more than one quarter in the forthcoming season, a deeper decline than forecast in a benchmark US report, in part thanks to the worsened prospects for crops in dryness-tested south, SovEcon said.
The influential analysis group pegged Russia’s grain shipments, which mainly comprise wheat, in 2012-13 at 20m tonnes, a drop of 28% on its estimate for the current – unusually strong – season.
The US Department of Agriculture last week pegged the decline in Russian grain exports at 19%, to 20.8m tonnes.
SovEcon said that its forecast reflected in part a dearth in unsold inventories in areas close to port expected at the end of 2011-12, following the rapid pace of exports, and the closure of a railway incentive which has drawn replacement supplies from Russia’s interior.
The end of June will bring the end of a period of discounted transport from Siberia, where stocks are relatively plentiful.
‘Potential for Sukhovey winds’
However, SovEcon also flagged the impact of "unfavourable weather" in southern regions, from which exports are largely drawn, and which has attracted increasing market attention, given the spur to global wheat prices which the first warnings in June 2010 over Russia’s last drought gave to prices.
Russia is typically seen as a supplier of ample supplies of competitively priced wheat.
At FCStone, Jaime Nolan-Miralles, noting that "temperatures remain high and precipitation low" in southern Russia, said: "Memories of yield decimation a couple of years back remain fresh in the markets mind."
Indeed, in an echo of 2010, official Russian forecasters have warned of a high risk of fire in rain-neglected areas.
Benson Quinn Commodities analyst Jonathan Watters noted talk of "the potential for Sukhovey winds, which destroyed much of the crop in 2010".
The Sukhovey winds, which blow in from Asian desert areas, have a history of disrupting agricultural output in Russia and Ukraine.
‘Crop development well behind’
At Australia & New Zealand Bank, Paul Deane said that in southern Russia, "crop development is now well behind this time last year and the long-term average.
"Some areas are even being compared to the 2003 crop which was southern Russia’s smallest harvest in a decade."
Earlier this week, the Moscow-based Institute for Agricultural Market Studies warned of "drought conditions" affecting "the vast region of Rostov, Stavropol, Volgograd, some parts of Krasnodar and Voronezh".
Even if rains do appear, as some forecasters believe, "some [crop] damage already looks irreparable".
And Viktor Zubkov, on a trip to southern Russia, said that "For this time of year the state of sugar beet, winter wheat and feed crops is not very good and differs from last year’s for the worse. The shoots are stunted", according to the Itar-Tass news agency.
Statistics: Posted by yoda — Thu May 17, 2012 5:45 am
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