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Russian wheat export prices registered a fifth consecutive weekly decline last week as benchmark prices in Chicago fell and the rouble weakened, analysts said on Monday.

A global sell-off sparked by coronavirus fears sent the rouble to its weakest against the dollar since early 2019 and caused a drop in Chicago wheat prices.

Russian wheat with 12.5% protein content loaded from Black Sea ports fell by $4 to $214 a tonne free on board (FOB) at the end of last week, SovEcon agriculture consultancy said. Barley fell by $5 to $185 a tonne.

"The (Russian) market remains under pressure due to strong competition with other origins. Sharp weakening of the rouble currency also helps exporters to lower prices," SovEcon said.

IKAR, another agricultural consultancy in Moscow, pegged wheat at $213 a tonne.

Russia exported 28.6 million tonnes of grain between the start of the 2019/20 season on July 1 and February 27, down 18% from a year earlier, the agriculture ministry said, citing customs data.

The Russian customs service revised and upgraded its data for previous months last week. As a result, SovEcon increased its February export estimate by 500,000 tonnes from a week earlier. It added that it would no longer use weekly customs data for its monthly estimates as it lacks data on supplies to Iran.

SovEcon said that it had nonetheless lowered its forecast for Russia's 2019/20 grain exports by 300,000 tonnes to 41.2 million tonnes due to a weak pace of exports. Its estimate for wheat is down by 100,000 tonnes to 32.1 million tonnes.

Russian officials requested additional work on the agriculture ministry's idea of introducing a grain export quota to take into account World Trade Organization rules, officials said last week.

"In our view, it improves chances that this legislation will not pass," SovEcon said.

Conditions for the new wheat crop remain good with warm weather and a healthy level of precipitation, SovEcon said, adding that it would be drier than normal in Russia's southern regions in coming weeks.

A sharp weakening of the rouble traditionally prompts some farmers to hold off selling to exporters, but this time they are likely to still be willing to sell their remaining stockpile as they need funds for the spring grain sowing, SovEcon said.

Copyright Reuters, 2020

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