Yesterday, after a long pause, Russian wheat successfully participated in the GASC tender. The Egyptian firm bought 60K of Russian wheat at $240 FOB (180 days payment) + $27.7 freight. They also bought 180K from Romania at $237.8 FOB + $32.7.
The lowest Russian wheat price decreased sharply week on week. Just a week ago the best price was $249.8 FOB (payment on sight).
The price for Russian wheat could be down amid the start of the new harvest and very good starting yields in some regions. Kuban, one of the top southern wheat growers, reports starting yield at around 6.2 mt/ha, close to a record-high. However, it could be a mistake to extrapolate this to other regions as well. Starting yields in Rostov and Stavropol, other southern regions, fail to impress at this stage and are close to average. In the Volga Valley, starting yields are, in fact, below average.
Combine mixed outlook for Russian crop with untransparent weekly-adjusted export tax and slow farmers selling, and you probably would agree with our expectation of cautious exports from Russia during several next weeks or perhaps even months.
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