PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 15:43 UK, 11th Feb 2013, by Agrimoney.com
Huge Russian wheat imports unlikely, says Ikar

Analysis group Ikar cautioned against ideas of huge Russian grain purchases, which some have pegged at a 13-year high, since even as the country said it may ditch duty on wheat imports sooner than had been thought.

Arkady Dvorkovich, Russian deputy prime minister, said on Monday that Russia would suspend a grain import duty before the April 1 deadline which had been mentioned, saying that the levy would be lifted "this quarter".

The prospect of an earlier suspension heightened talk of a spree of wheat shipments heading to Russia, which is usually renowned as a major exporter, but whose supplies have been shrunk by rapid shipments earlier in 2012-13 following a drought-hit harvest.

Already, on Friday, a major European commodities house, with major interests in Russia had pegged the country's wheat imports at "at least 2.5m tonnes", noting official forecasts of a 60% drop in grain stocks over 2012-13, and of 10m tonnes being the pipeline minimum for end-of-year supplies.

Big purchases ahead?

The Russian government assumptions, "if anywhere near correct, mean that they will be buyers of at least 2.5m tonnes of wheat between Easter and harvest," the commodities house said.

That alone would represent the biggest Russian wheat imports for a whole season since 1999-2000, when they topped 5.0m tonnes.

"At the moment the trade has chosen to ignore this story which, given the Russians reputation for saying one thing and doing another, might be fair," the traders added.

"But if it does happen this will be a major influence for world grain markets pre-harvest as most world supply and demand calculations show Russia as an exporter rather than as an importer."

Rationing vs importing

In fact, Russia has already imported more than 300,000 tonnes of wheat so far this season, mainly from Kazakhstan, data from the Moscow-based Institute for Agricultural Market Studies, or Ikar, showed on Monday.

However, the group's general director, Dimitri Rylko, described as "unlikely" the prospect of full-season exports of 2.5m tonnes or more, saying users would cut back on demand, or seek alternative grains.

"Most probably, Russia will see rationing, rather than important wheat at extremely high prices," Dr Rylko told Agrimoney.com, adding that this had "already happened".

While grain imports for the full 2012-13 were difficult to forecast, given infrastructure as well as market considerations, they would "definitely be more than 1m tonnes, and quite likely reach 1.5m tonnes" including the likes of malting barley, which had made up a large chunk of purchases so far in the season.

Imports so far

Russia had, by the end of last month, imported 650,000 tonnes of grain so far in 2012-13, the most in four years for a July-to-January timeframe, Ikar said.

However, while roughly 350,000 tonnes came from Kazakhstan, comprising mainly wheat, the 300,000 tonnes purchased further afield consisted mainly of malting barley and rice.

* Separately, Gennady Onishchenko, the head of Russia's consumer safety watchdog, said on Monday that a Russian ban on US beef, pork and turkey imports coming into effect this month would likely last for a considerable period of time.

"Apparently the ban on practically all US meat and meat products will be long term," Mr Onishchenko told the Interfax news agency.

Russia has said it will on February 11 ban US beef, pork and turkey over concerns of ractopamine, a growth stimulant commonly added to feed in America, but which some observers believe poses health concerns.

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