Russia Ships 96% Of Total Grains to Its “Friendly Countries”
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Wheat rose in price to a maximum since mid-February due to fears of reducing supplies from the Black Sea region. Chicago Wheat futures rose about 2.6% to $7.7725 a bushel. Wheat has been growing in price lately against Russia’s withdrawal from the Grain deal. The price rise intensified on reports of strikes on objects in the Odessa region.
In addition to the termination of the Grain deal, prices are affected by the unstable situation in the western part of the Black Sea basin. At the end of July, problems arose with the work of large Ukrainian ports (Odessa, Mykolaiv) and ports in the Danube Delta (Reni), which were used to export Grain both by sea and by the river to Romania.
Insurance industry sources said war risk coverage for Ukraine’s ports, part of a preliminary Grain agreement, has been suspended. On July 24, three sources said some insurers are also considering whether to continue providing coverage for ports on the Danube.
In the first week of the coming agricultural year, Grain exports from Russia more than doubled compared to the same period last season and reached 1.26 million tons, according to the Russian Grain Union (RGU), including shipments of Wheat increased by 95% to 938 thousand tons, Barley – by 2.5 times to 221 thousand tons, corn – by 5.6 times to 105 thousand tons.
According to the director of the analytical department of the union, Elena Tyurina, daily shipments for the first week of July amounted to 134 thousand tons; a year earlier, they were at 70 thousand tons. In her opinion, this allows them to expect Wheat supplies to be record-breaking in July and reach 3.5 million tons against 2.8 million tons in July 2022.
As per the Ministry of Agriculture forecast, Russia can supply up to 55 million tons of Grain to foreign markets in the new season. However, the export potential may be increased in case of an increase in the harvest. The head of the department, Dmitry Patrushev, said this at a plenary meeting during the All-Russian Field Day – 2023. He added that about 96% of Grain is sent to buyers from friendly countries.
According to the RGU monitoring, 148 thousand tons of Wheat were sent to Egypt against 9.5 thousand tons a year earlier in the first week of the new season. Shipments to Turkey increased by 15% to 143 thousand tons and to Saudi Arabia – by 35% to 111 thousand tons. The upward trend in exports to countries where Russian Wheat was not supplied in previous seasons in July also continued. Thus, Jordan purchased 63 thousand tons, Bangladesh – 54 thousand tons, Brazil – 36 thousand tons, and Tunisia – 27 thousand tons.
Last season, Russia exported a record 60 million tons of Grain, Patrushev said at the All-Russian Field Day, including shipments of Wheat amounted to 47 million tons. According to the Minister, this is a record figure; now, every fifth batch of Wheat on the world market is of Russian origin. In the 2021/22 agricultural year, Russia supplied 38.1 million tons of Grain to foreign markets, including 30.7 million tons of Wheat.
During the current marketing year, the monthly volumes of Russian Wheat exports by sea range between 2.0 to 4.5 million tons, averaging around 3.5 million tons. Turkey, Egypt, Iran, Saudi Arabia, Sudan, and Algeria are the top markets for sea-bound vessels.
Barley Export in Russia
In the crop year 2021/22, approximately 3.1 million metric tons of Barley were exported from Russia, marking a sudden decrease from the previous period. The figure was expected to increase twofold by the 2022/23 crop year. As per AgFlow data, Russia shipped 0.5 million tons of Barley in May-June 2023. In June, key markets were Egypt (66,000 tons), Saudi Arabia (61,000 tons), Iran (41,161 tons), and Libya (28,350 tons).
Other sources: AGRO INVESTOR
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