MOSCOW, April 24 (Reuters) - Russian wheat export prices fell last week due to low activity in the market ahead of the new crop arrival this summer and also because of a continuing trade dispute with Turkey, Russian agriculture consultancies said on Monday.
Turkey, traditionally the second largest buyer of Russian wheat after Egypt and the top buyer of its sunflower oil, has effectively put a hold on purchases of these products from Moscow by imposing high import tariffs in March.
Russian market players believe the move was in retaliation for Moscow's decision not to restore a visa-free regime with Ankara as well as open up its market for tomatoes to Turkish growers.
Russian and Turkish officials met in Moscow last week but did not reach a deal. The two sides reached "a common understanding" that further work was needed to resolve differences over trade, suggesting there will be no quick solution.
Black Sea prices for Russian wheat with 12.5 percent protein content for May delivery were $186 a tonne on a free-on-board (FOB) basis at the end of last week, down $2 from a week earlier, according to IKAR.as well as open up its market for tomatoes to Turkish growers.
The prices for the new crop for July-August delivery were quoted at $171 per tonne, it said.
SovEcon, another Moscow-based consultancy, pegged the new crop prices for the same protein content at $171-173 per tonne. The old crop prices were at $187.5 per tonne at the end of last week, down $2 from a week earlier, with FOB maize (corn) prices down $1 to $174 per tonne, it said.
"We think that the Turkish market will remain closed to Russia in the coming weeks, and possibly until the end of the season (on June 30), and this will put further pressure on (Russian) grain and sunseeds market," SovEcon said.
Russian President Vladimir Putin and Turkish President Tayyip Erdogan will meet in Russia's Black Sea resort of Sochi on May 3 to discuss the Syria crisis. But it is not clear so far whether they will also discuss commodities trade.
Russia exported 29.8 million tonnes of grain, including 23.0 million tonnes of wheat, between July 1 and April 19, the agriculture ministry said, down 0.5 percent year-on-year.
Russia's wheat crop is expected to fall this year, but the country's stockpile remains high after a record crop in 2016, and the number of sale offers from farmers is rising, SovEcon said.
Russia's grain stocks at farms and procurement and processing companies, excluding small farms, were up 19 percent from a year earlier at 28.3 million tonnes as of April 1, data from state statistics service Rosstat showed.
Domestic prices for third-class wheat fell 100 roubles compared with the week earlier to 9,500 roubles ($170) a tonne in the European part of Russia on an ex-works basis, SovEcon said. Ex-works supply does not include delivery costs.
Sunflower seed prices fell 250 roubles to 17,100 roubles per tonne, SovEcon said, while domestic sunflower oil prices fell 175 roubles to 40,075 roubles and export oil prices were down $5 to $690 per tonne.
There are some price-supportive factors, such as delays to Russia's spring grain sowing by colder weather, but farmers still have enough time to finish the process, SovEcon said.
As of April 21, farmers had already sown spring grains on 11 percent of the planned area, or on 3.4 million hectares, compared with 4.2 million hectares a year ago, according to the agriculture ministry.
IKAR's white sugar price index for southern Russia fell $5.4 to $581 a tonne as of April 21.
Source: Timesofindia.indiatimes.com
