Russian wheat crop forecast downgraded on weather

While the market closely watches rains in US, lack of them becoming an issue for the Black Sea. SovEcon downgrades Russian wheat crop.

The world market is closely watching the US weather trying to figure out when rains will stop in the Midwest and how many acres of corn and beans farmers will plant. However, the weather is also becoming an issue in the Black Sea region. Despite models’ predictions second half of May was drier than normal in several important wheat Russian regions in the Volga Valley and part of the South (#1 export region).

As a result, Stavropol, Samara, Saratov, and Orenburg regions still experience a lack of moisture which is likely to lead to some decrease of 2019 winter wheat yields. After analysis of current conditions, we have lowered Russian wheat crop forecast from 83.4 MMT to 82.6 MMT because of expected smaller winter wheat production.

On top of that, models now predict dryness in the first part of June in almost all European Russia as well as Ukraine. Potentially lack of precipitation may last whole June. If this scenario turns to be true we are likely to see many downgrades of new wheat crop estimates from analysts who in recent months were constantly upping their Russian numbers. Ukraine’s estimates also could be lowered but to a smaller extent.

This would support prices for the new Black Sea wheat crop which is currently being traded around $195 (FOB, 12.5% prot.).

Follow the Black Sea grain market

Get your free trial of The Sizov Report — an analytical service covering agricultural markets of Russia, Ukraine and Kazakhstan

Try for free

More Articles for You

Weekly round-up of Black Sea grain market – May 23

Russian wheat exports to tumble to 0.8 mmt in May, Ukraine is seeding corn fast despite the war

Weekly round-up of Black Sea grain market – May 16

Russian wheat exports to halve in May, no signs of de-escalation

Weekly round-up of Black Sea grain market – May 9

The weekly review of key Black Sea wheat and corn events

SovEcon ups Russian wheat crop forecast; Russia and Ukraine could export 60+ mmt of wheat in 2022/23

Russia could harvest 87 mmt of wheat in 2022; Russia + Ukraine 2022/23 wheat exports to reach 60+ mmt

SovEcon: 2022/23 Russian wheat crop and exports could be record-high

Excellent weather conditions and good inputs availability could lead to a record-high Russian wheat crop

Ukrainian 2022 grain crop to decline substantially

New Ukrainian wheat crop could decline by 19%, corn – by 34%, says SovEcon