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Russian winter grain sowings 'may fall short of record' after all - SovEcon

Russia’s winter grain sowings look unlikely to set a record after all, thanks to rains which slowed fieldwork in some areas, leading analyst Andrey Sizov Jr said - although the condition of seedings has improved.

 

Mr Sizov, managing director at Moscow-based SovEcon, trimmed earlier expectations of a rise in Russia’s winter grain plantings for the 2018 harvest exceeding the 17.8m hectares seeded last time.

 

The revision reflected data showing that plantings had in Volga Valley, one of the country’s three main winter grains areas, progressed “more slowly than last year”, thanks to wet weather which slowed seedings, and left farmers tied up longer than expected with corn and sunflower harvests too.

 

Official data show farmers in Volga valley some 270,000 hectares behind year on year on sowings of winter grains, of which some 85-87% typically comprises wheat in Russia.

 

Sowings catch up?

 

Nonetheless, Mr Sizov told Agrimoney that sowings still may slightly exceed the official target of 17.4m hectares

 

In European part of the country “the weather outlook looks OK, warmer than average,” allowing some regions to continue sowing.

 

And farmers in the South are some 150,000 hectares ahead on seedings, compared with last year, thanks to dry weather which had enabled rapid fieldwork, but raised concerns about lack of moisture.

 

‘Germination conditions are dubious’

 

Indeed, separately, the US Department of Agriculture bureau in Moscow, in a report released overnight, said that “soil moisture and germination conditions are dubious in the Southern regions of Russia”.

 

The report also noted that in the Volga Valley region, “the pace of fieldworks is lagging behind last year… due to rainy weather”.

 

Nonetheless, the bureau forecast a that “total winter crop acreage in 2018-19 may increase by 3% compared to 2017-18,” a figure which would imply record area.

 

“Industry analysts note that despite weak market prices, profitability remains strong enough to motivate farmers to increase total grain acreage in 2018-19.”

 

Crop recovery

 

While Russian growers no longer look likely to raise area of winter grains for the 2018 harvest, according to SovEcon’s latest estimates, production prospects nonetheless have received a boost thanks to the late rains in the South.

 

Although crops in the region, a major source of Russia’s wheat supplies for export, had looked “significantly worse than average” earlier in the growing season, “with the change in weather, crops have improved”, Mr Sizov said.

 

“I would think that the overall winter wheat crop would be in close-to-average condition,” he told Agrimoney.

 

Export prospects

 

The improvement raises the changes of Russia enjoying another strong wheat harvest, after the record 82.9m tonnes produced this year on estimates from SovEcon, which forecasts the country’s exports in 2017-18 at 33.9m tonnes, also an all-time high.

 

The USDA bureau lifted its estimate for this year’s harvest to 83.0m tonnes, 1.0m tonnes above the USDA’s official figure, and excluding the 900,000 tonnes or so harvested in the disputed territory of Crimea.

 

The bureau pegged Russia’s exports at 33.5m tonnes, also 1.0m tonnes above the official USDA forecast.

 

Overall grain exports were put at 43.6m tonnes, below capacity reported at 48m-55m tonnes.

 

“Russian grain exports are limited by such factors as ice conditions on the Azov Sea, loading restrictions at Black Sea terminals and trade obstacles at the biggest destination countries,” the bureau said.

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