Russian wheat export prices fell for a fourth consecutive week last week.
Indeed, according to the IKAR, Russian wheat with 12.5% protein content loading from Black Sea ports for supply in late February-early March stood at $319 a tonne free on board (FOB) last week.
That was down $6 from the previous week.
According to Sov Econ, wheat export price was down $7, at $323 a tonne.
Barley price was down $18 at $278 a tonne, meantime.
Domestic 3rd class wheat, European part of Russia, excluded delivery was at roubles/t 15,200 unchanged from prior week, although in USD gained +$5.39 closing at $201.22 (Sovecon);
Sunflower seeds were at 37,475 rbls/t, down 75 rbls (Sovecon);
Domestic# sunfloweroil was at 88,500 rbls/t, up 325 rbls (Sovecon) – Export sunflower oil was at $1,380/t, unchanged from prior week (IKAR);
Soybeans were at 44,250 rbls/t down 300 rbls (Sovecon);
Whitesugar, Russia’s south was at $652.3/t, up $12.6 (IKAR).
($1 = 75.5375 roubles).
Outlook:
Russian wheat exports are down by 41% since the start of the 2021/22 marketing season on July 1.
The export duty has been set at $93.2 a tonne for Feb. 9-15.
The Russian AgMin assessed the profitability of wheat production in Russia at the end of 2021 decreased to 51.8% against 56.1% in 2020, excluding state support.
For other agricultural crops, the indicator is only growing with profitability of corn production increased from 48.4% to 51.2%, for legumes – from 49.9% to 50.5%, for sunflower – from 80.2% to 95.4%, for soybeans – from 49.9% .4% to 77.7%, for sugarbeet – from 43.4% to 50.4%.
The indicator showed on wheat negative dynamics for the first time since 2017.
The reason for the decline in the profitability of wheat production: unfavorable weather conditions in a number of regions of Russia, which led to a drop in yields.
According to Elena Tyurina, the decline in the profitability of wheat production is due to the high export duties and the rising prices for all components of the cost of growing grain.
However, according to Eduard Zernin, a profitability above 50% is a good level, even if he doubt that we are talking about the profitability of the business.
Meantime, China will now allow imports of wheat and barley from all regions of Russia, under agreements signed during President Vladimir Putin’s visit to Beijing.
About this, AgMin annunced that a new railway terminal with 8 MMT PY capacity for exporting grain to China, will start operations in 2H 2022 in Zabaikalsk Region.
