Analysts are starting to rein in their forecast on Russian grain
exports made earlier in the season.
Previously high predictions were driven by reports of record breaking crops and the not unreasonable assumption that all this extra grain would find a home outside Russia.
Previously high predictions were driven by reports of record breaking crops and the not unreasonable assumption that all this extra grain would find a home outside Russia.
But it seems that as questions started to be asked about the quality of
that grain, previous record breaking export forecast have started dropping.
The Russian Ministry of Agriculture now report their grain
export forecast for July 2016 to June 2017 is 35mmt, down from 40mmt, including
wheat from 30mmt to 28mmt.
Rusagrotrans forecast 35.4mmt, down from 37mmt, including wheat
down from 28mmt to 27mmt and IKAR lowered their forecast from
40mmt to 39.4mmt including wheat from 30mmt to 29.5mmt.
Russia’s Ministry also reported that, as of November 9, grain exports
for MY16/17 are down nearly 5% on the same period last year at 14.017mmt (14.706mmt
in 2015).
Rusagrotrans initial October export forecast was 3.7mmt, but they say that due to bad weather, specifically wind keeping water levels low in the Azov and stormy conditions in the deep water Black Sea ports, it dropped to 3.2mmt,
Russia has the capacity to handle around 4.0mmt of grain
exports each month so they could still, in theory, export a further 32mmt on
top of the 14mmt already shipped.
Except that quality issue still hasn’t gone away. Couple of weeks back Russia’s phytosanitary
service released a report (here) on barley quality saying that many experts had called
into question the quality of this year’s crop without having any reliable data.
To be fair they didn’t shy away from the results which
showed that only 4% of the sample was 1st class compared to 14% last year. My assumption was they would conduct a similar survey for
wheat but I haven’t spotted anything yet.