Andrey Sizov
19.07.2021
Outlook for Russian wheat crop worsens. SovEcon cut 2021 crop estimate from 84.6 mmt to 82.3 mmt two weeks ago, USDA lowered its estimate by 1 mmt to 85 mmt a week ago.
SovEcon cut the forecast on smaller winter wheat yield estimates.
Current average Russian wheat yield is 3.44 mt/ha from around 12% of the harvested area. It’s +5.5% YOY from the similar area but bear in mind that 2020 was a year with very low starting yields.
The winter wheat yield is below our expectations for two key reasons. First, recent weather has been unfriendly for the new crop. Ample rains in the South at the start of the harvest slowed it down which led to some yield losses. Additionally, current abnormally hot weather leads to the fact that grain is becoming too dry (i.e. 10% moisture compared to around %14-16) which means lower weight and yield.
Second, it looks like that despite very good winter and spring conditions plants haven’t fully recovered in the South after abnormally dry fall. While yields in Krasnodar (#2 Russia’s wheat grower) are close to record-high, yields in Rostov (#1) and Stavropol (#3) are substantially below.
Recent hot and dry weather is also becoming a problem for the spring wheat in the Central Russia and the Volga Valley. The crop in Urals has been already badly damaged. Siberian spring wheat also suffered but recent rains party offset the earlier damage.
The dry forecast for the majority of spring wheat regions and current modest yield numbers could convert into more Russia’s wheat crop downgrades.
