On the eve of wheat harvesting, analysts compete in forecasts.
Back in early May, the US Department of Agriculture (USDA) suggested that Russia would collect 77 million tons, which would be lower than only the 2017 figure, when 85 million tons were collected.
And in conjunction with feed grain, the total yield, according to the USDA, will exceed 116 million tons.
In fact, the numbers of American and Russian statistics are somewhat different, because the USDA does not take into account the Crimean crop (1 million tons), and Russia in this forecast also includes legumes and buckwheat — and this is another 4-5 million tons.
It is also important that the Americans gave a generally optimistic forecast not only for the Russian market, but also for the world as a whole.
Transferring reserves in the world, according to the USDA, will increase by 5 million tons and amount to 149.8 million tons.
And consumption will reach a record of 753.5 million tons.
The market reacted to such forecasts by lowering prices: in May, a ton of wheat for the supply of a new crop was worth $ 198 and showed a decrease of 13% from the price at which trade was in May.
Our analysts are more cautious in their forecasts, they take into account adverse weather conditions prevailing in the south of Russia: the weather has been dry there for the last two months, and return frosts in April will also have a big impact.
In the Stavropol Territory, an emergency mode was even declared due to the persistent dry weather. And although the Rostov region replenished the moisture reserve, the situation in the Krasnodar Territory and the Stavropol Territory is still complicated: at the level of 2012-2013.
Most likely, it will be possible to compensate for possible losses in the south due to the Central Black Earth and Volga region. And in other regions there are no significant deviations.
Based on all this, the estimated collection volume decreased by 2-3% and “floats”, according to information from various sources, in the region of 124 million tons.
In wheat export forecasts, both Russian and American analysts converge in size around 35 million tons.
Although, as experts say, the final results will depend not only on weather conditions, but also on whether Russia will introduce further restrictions.
Representatives of the Ministry of Agriculture say they are likely to be.
To date, the price of wheat with 12.5% protein has dropped to $ 202 / t. (FOB Novorossiysk).
The cost of wheat for delivery in August fell by $ 7 to $ 199, and for delivery in July — by $ 8 to $ 195-198.
If unfavorable forecasts do not come true, then the fall in prices will continue.
Already, the price of wheat of the old crop has decreased from 15.5 thousand rubles per ton to 12.8 thousand rubles. (CPT Novorossiysk without VAT), and this is when selling FOB with delivery in July at a price of $ 204-208 / t.
The second interesting point in wheat pricing is what impact the pandemic will have on the solvency of some importing countries.
And some of the buyers have already made a supply of grain.
In general, the market supply will be good: Australia, India and China have increased their production.
Whether the price will continue to fall in the wheat export market or if the price is stabilizing, we will see very soon: harvesting harvest begins.
