Wheat Climbs to Three-Week High as Russia May Slow Shipments on Low Supply
Wheat stockpiles held by farmers in Russia’s main exporting regions in the south have dropped below last year’s levels, declining as much as 50 percent in some areas, SovEcon, a Moscow-based agricultural researcher, said yesterday. The country banned exports in August 2010 after its worst drought in half a century. The ban was lifted in July.
“Russia could potentially put some export curbs in place, but nothing is for certain,” said Sudakshina Unnikrishnan, an analyst at Barclays Capital in London. “For grains we have quite a bit of fundamental support.”
Wheat for March delivery climbed 1.9 percent to $6.535 a bushel at 1:15 p.m. London time on the Chicago Board of Trade. The price rose to $6.5475 earlier today, the highest since Jan. 4. Milling wheat for March delivery was 0.5 percent higher at 209 euros ($275) a metric ton on NYSE Liffe in Paris.
Inventories with farmers in the Krasnodar region, home to Russia’s main export hub at Novorossiysk, have halved, SovEcon said. In the Southern Federal District, farmers held 40 percent less grain than in 2011, while inventories held by producers in the Rostov region fell 42 percent, it said.
Russia’s three major grain-exporting provinces have shipped most of their supplies and that will lead to a “dramatic”slowdown in shipments from now through June, the U.S. Department of Agriculture’s Foreign Agricultural Service said Jan. 19. U.S. wheat inspected for export gained 27 percent in the week ended Jan. 19 from a week earlier, the USDA said Jan. 23.
Corn advanced for a sixth straight day as crop losses from a drought in Mexico deepened, potentially boosting demand for U.S. supplies. The country is the world’s second-largest importer after Japan and the second-biggest buyer of U.S. corn.
Acreage damage almost doubled after the worst drought on record. Losses covered 1.15 million hectares (2.8 million acres) as of Dec. 31 for the season ending in March, compared with 630,170 hectares a year earlier, according to data from the nation’s Agriculture Ministry posted yesterday.
Corn for March delivery gained 1.4 percent to $6.4325 a bushel. Soybean futures for delivery in the same month rose 0.8 percent to $12.23 a bushel in Chicago.
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