Russian wheat export prices rose last week for the first time since mid-August, buoyed by demand from Egypt after it dropped its policy of not importing wheat containing the ergot fungus.
Egypt’s state importer GASC bought 240,000 metric tons of Russian wheat last week, in its first successful tender purchase since abolishing the rule. Egypt is the biggest buyer of Russian wheat.
Black Sea prices for Russian wheat with 12.5% protein content for October delivery were $169 a metric ton on FOB basis at the end of last week, up by $2 from a week earlier.
SovEcon, a Moscow-based consultancy, pegged prices at $169 per metric ton.
Cairo is yet to approve delivery of another Russian wheat cargo, which was delayed by its ergot policy.
Moscow suspended imports of fruits and vegetables from Egypt from September 22, although it said the move was not a counter-measure against Cairo’s wheat policy.
Gains in Russian wheat prices may prove to be shortlived, SovEcon said: “The probable resumption of (wheat) supplies to Egypt may somewhat support Russian wheat export prices, but it will not be enough for a fundamental change in the situation in the domestic market”.
Russia exported 7.8 million metric tons of grain, including 6.6 million metric tons of wheat, between July 1 and September 21, the agriculture ministry said. Grain exports were down by 9% YoY. Official customs data has lagged real supplies this year due to technical issues, analysts have said.
Domestic prices for third-class wheat fell for the first time since early August as some farmers gave up hope that prices would increase, SovEcon said.
Prices fell by 25 roubles last week to 10,175 roubles ($159) per ton in the European part of Russia on an ex-works basis. Ex-works supply does not include delivery costs.
New crop sunflower seed prices dropped by 50 roubles to 22,250 roubles per ton, SovEcon said, while domestic sunflower oil prices fell by 575 roubles to 50,500 roubles and export oil prices were unchanged at $760 per ton. (Inforum/Business World Magazine)