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Russian wheat export prices snap six-week rise after Turkey halts imports

Russian wheat export prices ended six weeks of gains to fall last week along with global markets following Turkey’s decision to refuse wheat imports until mid-October.

The price of 12.5% protein Russian wheat scheduled for free-on-board (FOB) delivery in late June was $242 per metric ton, ending the week down $6, according to the IKAR consultancy.

The Sovecon agriculture consultancy pegged the same class of wheat at $250-$253 a ton, down from $252-$255 a ton FOB.

“The impact of the ban is uncertain, but Turkey’s wheat imports are likely to drop even without restrictions,” Sovecon said in its weekly note.

“We may see a reduction in Turkey’s wheat import estimates in the new WASDE report, partially offsetting a smaller Russian crop figure.”

Turkey is one of the largest importers of Russian wheat.

“Russian wheat crop problems were largely unnoticed by the market”, the agency analysts noted.

Last week Sovecon cut its 2024 wheat crop forecast to 80.7 million metric tons.

Agriculture Minister Oksana Lut said last week the ministry may adjust its 2024 grain harvest forecast of 132 million tons, including 86 million tons of wheat, due to drought in the southern, central regions of the country and the Volga region.

The weekly consensus forecast by the Rusgrain Union showed a 8.4% decline in the 2024 wheat crop to 79.5 million tons.

Russia said on Friday it was declaring a federal emergency in 10 regions because of damage to crops from May frosts, a measure that will help farmers with extra funds but which officials said should not derail export obligations.

As of May 31, farmers had seeded 24.0 million hectares of grains, compared to 27.8 million hectares in the same period in 2023. That included 10.4 million hectares of spring wheat, compared to 13.1 million last year, Sovecon wrote.

Russia is the world’s largest wheat exporter. Its exports rose to 1.36 million tons of grain last week from 0.80 million in the previous week. Exports included 1.19 million tons of wheat, up from 0.72 million tons a week earlier, Sovecon wrote, citing port data.

The first estimate of June wheat exports from Sovecon is 3.5-4.0 million tons, compared to 3.6 million tons in June 2023.
Source: Reuters (Reporting by Olga Popova; Editing by Jan Harvey)

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