Prices for Russian fourth-grade milling wheat rose as much as 7.6 percent to 7,100 rubles ($218) a metric ton in Stavropol and Krasnodar in the week to yesterday, on falling stocks and drought, according to the Institute for Agricultural Market Studies.
The country’s grain stocks fell to 16.8 million tons on June 1 from 22 million tons on May 1, according to the State Statistics Service data. The Agriculture Ministry cut its 2012 harvest forecast this week to 85 million tons from an earlier estimate of 94 million tons because of winter frosts and spring drought.
Parts of Rostov and Krasnodar in the Southern federal district and in Stavropol in North Caucasus were in drought, prompting lower expectations for the new crop, increasing demand among local traders and millers and pushing prices up, Oleg Sukhanov, head of market analysis at the institute, known as Ikar, said yesterday.
Certain big lots, comprised of several dozen tons of grain, were offered at as much as 7,300 rubles a ton at farms in North Caucasus, Sukhanov said in a telephone interview in Moscow.
Rising Russian prices may be enough to keep wheat in the country and to curb exports, according to Ikar. Exporters slowed down their business and are waiting for a wider margin between international and domestic prices, Sukhanov said.
Wheat for September delivery rose 0.4 percent to $7.49 a bushel on the Chicago Board of Trade by 6:09 p.m. Moscow time. That converts to $275.21 a ton. Russia’s wheat price is $270 to $275 a ton at free-on-board basis in the Black Sea port of Novorossiysk at present, Sukhanov said.
Russia’s wheat exports are seen at 13.5 million to 13.8 million tons for the season 2012-13, compared with an estimated 21 million tons in 2011-12, according to Ikar data.