Sharp increase in the forecast of the wheat harvest in Russia by SovEcon increased pressure on stock prices

Global wheat prices remain under pressure from news about the harvest in Russia, which accounted for 28% of global wheat exports last year.

On the forecasts of a reduction in the wheat harvest in Russia in April-May, world prices rose by 30%, and a new adjustment of estimates led to lower prices.

According to Rusagrotrans analysts, in 2023/24 MY Russia exported 55.4 mln tonnes of wheat, and the share of Russian wheat in global exports increased to 28% compared to 25% in 2022/23 MY. Export prices for July deliveries of Russian wheat with a protein of 12.5% for the week fell by $10/t to 222 $/t FOB, while French wheat is offered at 238 $/t, German – at 244 $/t, and American – at 222 $/t FOB.

the Russian Agency SovEcon amid improving weather conditions in the regions of cultivation of spring wheat and the first data on the harvest yesterday raised its forecast of wheat production in Russia in 2024/25 MG by 3.4 million tons to 84.1 million tons, while experts USDA in June lowered its forecast for Russia from 88 to 83 million tons.

According to the latest data, in Rostov region, early grains were harvested on 22% of the area with an average yield of 3.6 t/ha, in Stavropol region – on 53% of the area with an average yield of 3.56 t/ha, which is slightly lower than last year. In the Krasnodar region, winter wheat was harvested on 50% of the area, with an average yield of 6.5 t/ha, which is in line with last year. Almost 83% of the surveyed wheat is of food quality.

July wheat futures fell again yesterday:

• by 1.3% to 203.7 $/t – for soft winter SRW wheat in Chicago,
• by 2% to 213.7 $/t – for hard winter HRW wheat in Kansas City,
• by 1.1% to 228.18 $/t – for hard spring HRS wheat in Minneapolis,
• by 1.7% to 223.25 €/t or 240.8 $/t – September wheat futures on the Paris Euronext.

Tags: EU, prices, Ukraine, Russia