SovEcon: Russian wheat stocks rise to record-high levels amid sluggish sales by farmers

The good 2022/23 crop and sluggish sales in the South contributed to the growth in stocks.

As of April 1, Russian wheat stocks totaled 27.5 million metric tons (MMT), matching last year’s levels and exceeding the average by 65%, SovEcon said in a report. Russian stocks are near the record-high levels of the previous year due to ample 2022/23 crop and sluggish wheat sales by farmers.

Rosstat reported that 92.8 MMT of wheat was harvested in 2022/23, 5% above the three-year average.

Wheat stocks are close to last year’s levels, amid record-high on-farm wheat stocks in the South. Stocks in the South amounted to 4.1 MMT, up 8% from last year. In the Central region, stocks were 4.0 MMT (down 14%), and in the Volga region, 3.2 MMT (up 1%).

On-farm stocks have grown amid relatively sluggish sales. Since the beginning of the season, farmers in the South sold 16.3 MMT, 1 MMT less than the previous year. Sales in the Central and Volga regions are trailing last year’s pace by less than 0.5 MMT.

Many farmers in the South are likely holding onto their stocks until the new season, hoping to sell at higher prices. Mid-March wheat prices in the South were 10,900 rub/mt, 1,400 rub lower than last year.

Farmers’ readiness to hold back sales until the new season is expected to support both the Russian and global wheat markets.

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