Russian wheat prices rose for a fourth consecutive week through Friday thanks to strong demand from exporters and stockpiling by domestic processors before the market quietens down in late December and early January, analysts said. Egypt's state grain buyer GASC bought 295,000 tonnes of Russian wheat in a tender last week. Russia is the world's largest wheat exporter, while Egypt is the largest buyer of Russian wheat.
Black Sea prices for Russian wheat with 12.5% protein content and December delivery were up $1.5 to $210 per tonne on a free on board (FOB) basis at the end of last week, agricultural consultancy IKAR said in a note.
SovEcon, another agricultural consultancy in Moscow, said wheat prices were up $2 to $212.5 per tonne, a new seasonal high. Barley remained at $188.50 per tonne.
SovEcon expects FOB wheat prices to stabilise at the current level and points out that any attempt to lower them would be challenging due to the stronger rouble currency and rising domestic wheat market.
Domestic prices for third class wheat in the European part of Russia rose 250 roubles to 11,650 roubles ($182.5) a tonne by the end of last week, SovEcon said. That price was on an ex-works basis, which excludes delivery costs.
Some market participants say that a lot of farmers have sold what they planned to sell in 2019 and have left the market, SovEcon said.
Wheat in Russia's central regions rose last week by another 200-300 roubles per tonne and became too expensive for export, IKAR said.
Russia exported 20.8 million tonnes of grain, including 18.2 million tonnes of wheat, between the start of the 2019/20 season on July 1 and Dec. 5, SovEcon said, citing customs data. Total grain exports were down 15% from a year ago.
Sunflower seed prices rose by 425 roubles to 16,700 roubles a tonne as exporters and domestic processors continue accumulating stockpiles before the New Year, SovEcon said.
Domestic prices for sunflower oil rose by 500 roubles to 42,675 roubles a tonne, while export prices fell by $20 to $705 per tonne, it added.
The weather remains favourable for Russian winter grain sowings, SovEcon said, adding that healthy rains arrived in major winter wheat producing regions in Russia and Ukraine last week.
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