Prices rally as Russian crop reduces

US weather has been a key factor for prices over the past few months, with the northern plains in particular feeling the effects of hot, dry weather. However, alongside concerns about US crop conditions the Russian wheat crop has also begun to be walked lower.

This week has seen the release of three key forecasts for Russian wheat production from the USDA, SovEcon and IKAR. All three reports have begun to walk the Russian wheat crop lower.

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Even with export restrictions in place, Russia is once more set to be the biggest global exporter of wheat. As such, reducing crop sizes in the nation will have a significant impact on the price of wheat globally.

The primary reason being cited for the reduction to Russian crop size is reduced yields in Southern Russia following the dry autumn in 2020. While rains were seen through winter it is believed that these were not enough to drive a recovery in yields.

A report published yesterday by SpecAgro on behalf of the Russian Ministry of Agriculture, highlighted that as of 15 July, around 13% of the Russian wheat area had been harvested. The average yield for wheat from that area was 3.4 t/ha.

Rain over the last 14 days had delayed harvest, for the most part harvest in the South of the country should be able to progress with a drier outlook over the next fortnight. The spring wheat region in Russia (to the north of Kazakhstan) may also need watching closely, with vegetation health indices, showing crop condition to be down on the year.

With the margin for error in grain markets small this season, due to low stocks coming out of the 2020/21 season, harvest progress in major exporters needs watching closely.

Prices rally as Russian crop reduces
GB regional wheat production estimates 2021/22
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LIVE - DEFRA SFI Janet Hughes “ask me anything” 19:00-20:00 20th September (Today)

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Hello, I’m Janet Hughes. I’m the Programme Director for the Future Farming and Countryside Programme in Defra – the programme that’s phasing out the Common Agricultural Policy and introducing new schemes and services for farmers.



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