Russia Will Cut Grain Exports Estimate as Harvest Mostly Shipped

Russia, facing the smallest wheat crop in a decade, will reduce its grain exports estimate by about 10 percent with most of the harvest already shipped and competitors offering better prices.

The estimate will be lowered to 14 million metric tons, from 15.5 million forecast in November, Deputy Agriculture Minister Ilya Shestakov told reporters in Moscow today. The government will release its forecasts on Jan. 31, he said.

“Our grain has become non-competitive,” Shestakov said. “We have just fulfilled all old export contracts.”

Russia’s domestic grain prices have “skyrocketed” as stockpiles have dwindled with the wheat crop the lowest in 10 years, the Foreign Agricultural Service of the U.S. Department of Agriculture said in a report on its website. Russia may have to boost grain imports to 2 million tons in the spring, with stockpiles below levels of three years ago, it said. Russia will have about 9 million tons of grain stockpiles by the end of the season on June 30, Shestakov said.

Russia’s Agriculture Ministry will not propose canceling a 5 percent grain imports duty, as some companies proposed, because Deputy Prime Minister Arkady Dvorkovich refused to support the idea, Shestakov said.

To contact the reporter on this story: Marina Sysoyeva in Moscow at msysoyeva@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net