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Dryness, which has caused 'some panic', cuts Kazakh wheat export hopes

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Kazakh wheat exports will not rebound much after all in 2020-21 from five-year lows, US officials said, cautioning over crop damage from dryness, which has left early-sown fields “failing at up to a 50% rate”.

 

The US Department of Agriculture’s Astana bureau pegged at 6.20m tonnes Kazakh wheat exports in 2020-21, on a September-to-August basis.

 

That is well below the 7.10m tonnes that the USDA is officially expecting, and estimates of 7.5m tonnes from other commentators, such as the United Nations FAO.

 

It would also represent only a modest recovery from the 6.00m tonnes in shipments expected for 2019-20 – a tumble of nearly 2.3m tonnes year on year, reflecting drought damage to last year’s harvest.

 

The bureau said that while winter rains had recharged soil moisture levels, dryness had struck once again in recent weeks, limiting prospects for a recovery in yields.

 

‘Caused some panic’

“The lack of rains in early June and resulting low soil moisture caused some panic among farmers, who fear a possible drought this summer,” the bureau said,

 

While officials report only 3% of grain and legume crop area as being in “unsatisfactory” condition “farmer views on the current crop are mixed”.

 

The bureau pegged the Kazakh wheat harvest this year at 12.80m tonnes, up more than 1.3m tonnes year on year, but behind the official USDA estimate of 13.50m tonnes.

 

Excluding 2019, a 12.8m-tonne result would be the lowest in eight years.

 

The bureau said that its forecast was based on satellite and soil moisture data “as well as the consensus that poor weather conditions impacted the earliest wheat planted.

 

“Farmers report early plantings as failing at up to a 50% rate.”

 

Global trend

The downgrade highlights the latest in a series of setbacks to wheat production hopes in major exporting countries, with market expectations for harvests in the likes of Argentina, the European Union and Russia also having suffered downgrades.

 

Separately on Tuesday, Agritel reported that with 8m hectares of the Russian crop harvest, the average yield so far of 3.47 tonnes per hectare is “the lowest in the last six years at this stage”.

 

However, it added that early yields from Central region had proved “good, with potentials exceeding 5 tonnes per hectare”.

 

Moscow based analysis group SovEcon on Friday said that “we feel that the market has already digested poor yields in the Russian South but now it could be underestimating the crop in the rest of the country and the area figure”.

 

Meanwhile, a briefing from USDA staff in Canberra issued an upbeat estimate for Australia’s wheat harvest late in 2020.

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