SovEcon cut its 2023/24 Russian wheat crop forecast from 91.6 to 91.4 MMT. The estimate was revised due to deteriorating crop prospects in the Urals and Siberia regions.
In Siberia, the wheat production estimate was cut by 0.5 MMT to 8.7 MMT, while in the Urals region, it was reduced by 0.2 MMT to 3.9 MMT. The wheat crop suffered due to drought conditions earlier. SovEcon expects that a substantial share of the area will remain unharvested because of slow campaign progress.
This was partly offset by improved outlook for the Volga region. The wheat production forecast was raised by 0.4 MMT to 18.6 MMT, amid relatively high spring wheat yield.
The US Department of Agriculture estimates the 2023/24 Russian wheat crop at 85.0 MMT. The assessment appears understated to us since, by mid-October, over 90.0 MMT of Russian wheat had been harvested.
Despite a slight reduction in the Russian wheat crop estimate, wheat supply will remain high, continuing to exert pressure on global prices. At the same time, the main issue for Russian exports currently is not total supply volume, but infrastructural bottlenecks and governmental intervention.
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