Russia, the world’s third biggest wheat exporter, forecast a 20 percent year-on-year drop in its harvest to 45 million metric tons, as prices climb on drought in the country.
Wheat for September delivery rose 3.1 percent to $8.74 a bushel on the Chicago Board of Trade by 2:31 p.m. London time, and is up 34 percent for the year. That converts to $321.14 a ton. Milling wheat climbed 4.8 percent in seven days to 8,125 rubles ($249) a ton on the European side of Russia by the end of last week, SovEcon, the Moscow-based consultancy, said on its website.
“Wheat yields are still not high,” Agriculture Minister Nikolai Fedorov said at a news conference in Moscow today. He said the main reason for the harvest decline was due to the drought in Russia’s south in May and June.
The grain forecast was cut from a previous estimate of 49 million tons to 50 million tons, according to the ministry. In 2011-12 the country harvested 56.2 million tons of wheat and shipped more than 27 million tons of grains and legumes, according to state statistics data.
This year, which runs from July 1 to June 30, 2013, grain exports are seen between 16 million tons and 20 million tons, including between 14 million tons and 17 million tons of wheat, depending on the weather, Fedorov said.
The U.S. Department of Agriculture sees Russia’s wheat exports at 12 million tons for the current season, down from 21.3 million tons in the year-ago period.
Wheat yields may reach a record in some central and Volga regions, Fedorov said. That’s why the ministry “didn’t go far” from its total June grain and legume forecast of 85 million tons, he said. That compares with 94.2 million tons last year.
The ministry based its estimates on the Federal Service for Hydrometeorology and Environmental Monitoring forecast, which sees the crop at 83 million to 86 million tons this season, Fedorov said.
To date, Russia’s harvested 13.7 million tons of grains from 5.5 million hectares (13.6 million acres), or 12 percent of the sown area, the minister said. The wheat harvest reached 11.7 million tons from 4.6 million hectares, or 18 percent of the sown fields, he said.
Russia has shipped 400,000 tons of grain to date this year, he said.
The country’s carryover stocks are seen at 16.8 million tons for the beginning of the new season, down from about 19 million tons a year earlier, Fedorov said, adding there is enough to meet domestic demand.
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