Russia's Wheat Production in-Decline

[errolanderson]

Abnormally cold May weather in Siberia lowering spring wheat production by as much as 4 million MT, plus too dry in southern regions will cut into Russia's wheat production this year.

https://www.bloomberg.com/news/articles/2018-06-12/russia-s-bad-weather-mix-is-sinking-the-country-s-wheat-crop

Chicago wheat has been one of the hottest commodities in 2018, up more than 20%. This situation has yet to impact the Black Sea export prices as market is still running on last year's oversupply.

Siberia situation should be supportive to Cdn wheat prices (IMO) heading into the fall market.

[bucket]

No worries Justin will visit the kremlin and **** that up too....

Probably wear some Ukrainian outfit to piss Putin off.

[sumdumguy]

Too cold and dry - really sounds like global warming to me.

[Agvocate]

Australia has cut its forecast wheat production by nearly 8 percent for 2018/19, the country's top commodity agency said in a report released on Wednesday, as prolonged dry weather across the country's east coast crimps national output. The world's fourth-largest exporter of the grain said production during the 2018/19 season would total 21.9 million tonnes, down from a previous forecast of 23.7 million. It also said yields could fall further without desperately needed rains. "Sufficient and timely winter rainfall will be critically important for crop development," the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) said. Lower Australian wheat production could support benchmark global prices, which have soared around 14 percent since early April as traders worry about lower global supply amid unfavourable weather across major exporters, including the United States, Russia and Australia.

[farmaholic]

This shit gets tiring. Glut, no glut, 2 years supply....ooops, does the world really realize there isn't enough wheat for the world if no crop was grown the world over? Hand to mouth, until there's nothing in the hand?!?!?!?!?!?!?!?

[furrowtickler]

This shit gets tiring. Glut, no glut, 2 years supply....ooops, does the world really realize there isn't enough wheat for the world if no crop was grown the world over? Hand to mouth, until there's nothing in the hand?!?!?!?!?!?!?!?

I agree farma - it’s a joke , like the flavour of the day to push markets .
It’s getting old .

[bucket]

Some open market ....fundamentals and facts are now fake .....and HFT is what trades the day...can't grow a crop in a millisecond. ..

[SASKFARMER3]

I agree any thing they can do to drop the price not a peep about problems out there.

Russia and Ukraine and some places in Europe are very dry. But move on nothing to see.

Yea the market knows jack shit

[Klause]

From Blacksea Grain

In the past week, at least four analysts ratcheted down their estimates for Russia’s wheat crop because of bad weather. Dryness in the south, the main growing region, has parched crops, while cold and soggy conditions are hurting fields in Siberia and the Urals. The U.S. Department of Agriculture expects the crop to shrink for the first time in six years.

“The prospects for the new crop are melting down,” Arkady Zlochevsky, president of the Russian Grain Union lobby group, said at a conference in the country’s southern city of Gelendzhik on Friday.

Withering Wheat

The lower forecasts are helping fuel a rally in prices, and money managers are the most bullish in 10 months. The bleakest estimate is from the Russian Grain Union, which sees the crop shrinking as much as 21 percent from last year. The harvest size -- still expected to be the nation’s third-largest on record -- will be among the market’s focus when the USDA releases world estimates Tuesday.

A lack of rain in the south in May and June will probably cut wheat yields by 30 percent from a year earlier, according to the trading unit of southern grower Steppe Agroholding. Any showers before winter wheat starts being harvested toward the end of the month probably won’t help crops, said Alexey Novoselskiy, general director at the trading unit based in Rostov-on-Don.

Here’s a breakdown of recently lowered estimates for the 2018-19 season:

Russian Grain Union: 68 million to 69 million tons
ProZerno: 70.4 million tons
Institute for Agricultural Market Studies: 71.5 million tons
SovEcon: 73.1 million tons
The USDA in May pegged Russia’s crop at 72 million tons

Wheat futures have climbed about 22 percent in Chicago this year, making the grain one of the top-performing commodities, as speculators turned bullish on prices. Money managers raised bets on higher prices to the most since late July in the week to June 5, U.S. government data show.

Russian winter wheat is typically harvested in the two months or so through August, mainly in southern and central regions, while spring crops get planted in eastern areas around May. Those sowings continue to be delayed by cold and wet weather, according to ProZerno.

“It’s an absolute drama in Siberia that had blizzard conditions as recently as May,’’ Vladimir Petrichenko, director general at ProZerno, said at the conference.

The adverse weather has come after farmers reduced purchases of fertilizers and crop-protection chemicals amid lower profit margins this season, Zlochevsky said. That means crops now being grown are more exposed to weather risks, he said.

While conditions have been unfavorable in parts of the south and east, wheat in central Russia, another major growing region, is in a better shape than normal, SovEcon said.

[checking]

Just in time delivery works really well, until it is not delivered. It is a lot like attempting to farm a hole. It works until a five inch rain fills it up over an 18 hour period. First the world drowns in wheat, and boom it is suddenly worth $6.00/bushel for feed wheat. Accept it while (blink) it lasts, pharma. Chequing!