Page 102 - RusRPTApr20

9.1.6 Agriculture sector news
Ruble devaluation and higher global prices have pushed Russian domestic wheat prices by RUB1,000 to record-high RUB13,300 per tonne, Kommersant daily reports on March 23 citing the data by Sovekon agency. To compare, Russian exports blend Urals oil as of March 19 traded at less than RUB13,000 per tonne. The growth of Russian grain prices is in line with global trend, with commodity exchanges over the world showing about 7% price growth for wheat. As reported by bne IntelliNews, Russia is battling it out with Ukraine for the title of world’s biggest gain exporter, but narrowly lost the title last year when both counties exported circa 45mn tonnes of grain. Grain exports have become a real moneymaker for Russia, which earned circa $20 last year.
Souzrossahar sees three sugar refineries as not participating in the upcoming marketing year in sugar 2021 from August to July. The total refining capacity of the three plants is 150,000 tonnes, equal to 2.5% of annual consumption and mid-cycle production in our forecasts. The refineries see challenging financial conditions, as sugar prices are 43% y/y lower in January- February (RUB18/kg) and are likely to generate negative financial results for certain industry participants. In the current season, Russia produced more than 7.5mn tonnes of sugar vs. consumption of 6mn tonnes, creating a sizable overhang. Analysts anticipate greater details on the production season as well as the beet planting area (May 2020). Analysts say the prospects for a healthier sugar supply-demand balance are still vague.
102 RUSSIA Country Report April 2020 www.intellinews.com