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During the reporting week from 15.03.24 to 22.03.24, there was a rise in global wheat prices. Soft red winter wheat on the Chicago Board of Trade (CBOT, ZW) increased to 554.75 cents/bushel (+4.97%). Hard red winter wheat on the Kansas City Board of Trade (KCBT, KE) rose to 590.50 cents/bushel (+4.28%). Hard red spring wheat on the Minneapolis Grain Exchange (MGE, MWE) also saw an increase to 661.00 cents/bushel (+2.24%).
The corn contract on the Chicago Board of Trade (CBOT, ZC) showed a slight increase to 439.25 cents/bushel (+0.57%). The price of rice in Chicago (CBOT, ZR) decreased to $17.34/cwt (-1.08%). Russian indicative prices (FOB Black Sea) for wheat decreased to $235.80/ton (-0.08%), barley increased to $181.50/ton (+0.22%), and corn decreased to $171.50/ton (-1.89%). The Russian wheat index, CPT Novorossiysk, decreased to 12983 rubles/ton (-0.02%).
Domestic purchase prices for 4th class wheat with 12.5% protein at port elevators of the Black and Azov Seas during the reporting period are as follows: Azov - 11600 (0) rubles/ton, Novorossiysk - 14000 (0) rubles/ton, Rostov-on-Don - 11600 (0) rubles/ton, Taganrog - 11200 (0) rubles/ton, Taman - 14000 (0) rubles/ton. According to the latest data, as of March 21, approximately 1 million hectares of spring crops have been sown in Russia, which is twice as much as last year. The Ministry of Agriculture's plan is to sow spring crops on an area of 56 million hectares, and currently, spring field work is underway in 23 regions.
The Ministry of Agriculture of the Russian Federation does not plan to cancel the grain export duty but is ready to adjust it to reduce the financial burden on grain producers. The adjustment will be made at the beginning of the new agricultural season. One of the largest grain exporters from Russia, TD "Rif," has suspended exports due to quarantine objects found in batches of grain and leguminous crops. Rosselkhoznadzor reported that TD "Rif" did not meet the requirements of importing countries in 44 (or 81%) of grain export batches totaling more than 1 million tons since the beginning of 2024.
The Ministry of Agriculture of the Russian Federation has allocated 2.14 million tons of additional quota shares for the export of wheat and wheat flour, barley, rye, and corn. No decision was made at the EU summit to impose tariffs on grain imports from Russia and Belarus. Earlier, it was reported that the European Commission plans to set a duty of €95 per ton. The National Mercantile Exchange (NME) will continue to purchase grain for the State Intervention Fund.
The next trades are scheduled for March 27, 28, and 29, 2024. Grain purchases for the state fund were suspended on March 7 but will resume after the completion of competitive procedures by AO OZK to select the exchange. In the second decade of March, Russia increased grain exports by nearly 2.3 times. 2.875 million tons of grain were shipped for export, compared to 1.269 million tons in the first ten days. The increased competitiveness of Russian wheat on the global market was the reason for this dynamic. The Ministry of Agriculture is considering the possibility of creating a grain exchange within BRICS.
In early March, the Chairman of the Grain Exporters Union announced the initiative to create such an exchange among BRICS member countries at a meeting with the President of the Russian Federation and employees of the agro-industrial complex. Starting from March 27, 2024, customs duties on wheat and barley will be increased, while those on corn will be reduced. In Belarus, early spring and leguminous crops (excluding corn, buckwheat, and millet) have been sown on an area of 54.1 thousand hectares, which is 8.68% of the plan. In Ukraine, 20 regions have started spring sowing of crops.
Currently, 214.5 thousand hectares of grain and leguminous crops have been sown, which is 3.8% of the plan. In Kazakhstan, the Ministry of Agriculture announced a reduction in wheat sowing areas as part of a diversification program.
This season, wheat planting areas decreased by 430 thousand hectares compared to last year. In 2023, the wheat planting area in Kazakhstan was 13.7 million hectares. Detailed information on the grain market status as of 22.03.2024 can be found in the Grain Market Review on 22.03.2024. Stay updated on the grain markets of Russia and the CIS countries in our Telegram channel. Details are also available on the website zerno.ru.
