Russian wheat export prices stabilise after five-week rally

MOSCOW: Russian wheat export prices were relatively stable last week, after more than a month of gains, as the risk of export curbs on grain eased.

Black Sea prices for Russian wheat with 12.5 percent protein content and for delivery in October were $231 per tonne on a free on board (FOB) basis at the end of last week, down $1 from a week earlier, Russian agricultural consultancy IKAR said in a note on Monday.

SovEcon, another Moscow-based consultancy, quoted FOB wheat and barley prices unchanged at $230 a tonne and $234 a tonne, respectively.

Russian wheat export prices had been rising in recent weeks as increased inspections by the agriculture safety watchdog unnerved the market.

The watchdog has been tightening quality controls when issuing its export certificates to traders and is inspecting grain loadings at ports across Russia. However, it has not introduced any measures to curb exports and the market believes the risk of that happening is now less likely.

"Exporters are still complaining (about) lengthy execution of phytosanitary certificates," SovEcon said. "But there is no significant news (on the issue) in the market."

As of Oct. 18, Russia, a major global grain exporter, had exported 17.7 million tonnes of grain since the start of the 2018/19 season on July 1. That was up 21 percent compared with a year ago and included 15.2 million tonnes of wheat.

Russia is finishing 2018 grain harvesting and sowing of winter grains for the 2019 crop. Farmers have sown winter grains on 99 percent of the planned area, or on 17 million hectares.

"Rains are expected in a significant part of the European part of Russia in the coming weeks, and this will improve the condition of winter grains," SovEcon said.

Domestic prices for third-class wheat were up 225 roubles at 11,275 roubles ($173) a tonne at the end of last week in the European part of Russia on an ex-works basis, SovEcon said. Ex-works supply does not include delivery costs.

Prices for sunflower seeds fell 350 roubles to 18,125 roubles a tonne, SovEcon said. Domestic prices for sunflower oil declined by 825 roubles to 45,175 roubles a tonne, while export prices were flat at $660 per tonne.

IKAR's white sugar price index for southern Russia was at $540 a tonne on Oct. 19, up $1 from a week earlier. ($1 = 65.2585 roubles)