Andrey Sizov
02.04.2024
As of March 1, on-farm wheat stocks in the South, Russia’s key export region, totaled 5.6 MMT, SovEcon reported. The stocks surpass last year’s figures by 12%, which is a more significant increase than in other regions. Wheat stocks reached a record high amid sluggish sales by farmers.
Nationwide, the on-farm wheat stocks (excluding small farms) amounted to 17.5 MMT, 1% higher than last year. In the Central region, stocks were at 4.8 MMT, 12% below last year’s figures; in the Volga region, stocks were 3.7 MMT, 4% higher than the previous year.
The South’s stocks remain at record levels due to sluggish sales. From December to February, farmers in the South sold 3.6 MMT of wheat, 25% less than last year. In the Central region, 3.7 MMT of wheat was sold during the same period (21% more compared to last year), and in the Volga region, 2.0 MMT was sold (-10%).
Many farmers in the South are likely holding onto their stocks until the new season in hopes of selling at higher prices. As of early February, the price of 4th grade wheat (prot. 11.5%) in the South was 11,750 rubles per metric ton, 1,050 rubles less than the year before.
Another factor might have been the relatively sluggish demand from exporters for nearest delivery grain until recently. Many have been actively purchasing grain in non-southern regions for shipment in 1-2 months, resulting in lower port prices.
Farmers’ readiness to hold back the sales until the new season is expected to support both the Russian and global market.
