by Agrimoney.com
US farm officials cautioned over the revival in Kazakh wheat crop hopes and warned on expectations of huge Russian grain exports, even as leading analysts raised hopes for a strong start for shipments.
The US Department of Agriculture's Astana bureau said that while soil moisture were "very good" when the Kazakh wheat crop, which is essentially all spring sown, was planted, conditions have deteriorated since.
"The weather since planting has been very dry in key growing areas, and this has largely depleted the soil moisture," the bureau said.
"Timely rains in July and August are critical for the 2013 crop."
The bureau estimated the Kazakh crop at 14.0m tonnes, below the USDA's official forecast, which was downgraded to 14.5m tonnes two weeks ago because of a "lower planted area" estimate.
'Yields have been decreasing'
Meanwhile, the USDA's Moscow staff cautioned against being overoptimistic on prospects for Russian wheat exports, despite a strong start to the harvest, which had reached 20.7m tonnes as of July 16, a rise of 7.7% year on year, with 75% of area yet to be reaped.
The yield had averaged 3.23 tonnes per hectare, up from 2.55 tonnes per hectare a year before, and from an area largely focused on the southern region which is a major export area.
"So far the harvest is ahead of the typical schedule, and the yields are higher than last year," the USDA staff said.
"However, some industry analysts already expressed concerns that as the harvest progressed and moved to the Volga Valley and Urals, average grain yields have been decreasing much faster than in 2011."
Besides dryness, commentators have also cautioned over damage from locusts in the south of the Volga Valley area, and "from other pests and diseases", the office said, pegging the crop at 53m tonnes, 1m tonnes below the official USDA estimate, if above figures from some other analysts.
Quality factor
Furthermore, some analysts are "sceptical" over ideas of bumper Russian exports in 2013-14, despite the good crop in the South, and the area's easy access to Black Sea ports.
"One of the main concerns is potential purchases from Egypt, Russia's key customer, and which accounts typically for half of all of Russia's grain exports in the September-November period," the Moscow office said.
Stronger competition from neighbouring Ukraine has also been seen as a dent to Russia's harvest hopes, while quality may be a factor too.
"Industry analysts are also anxious because, despite quite abundant crop in southern European Russia, the gluten content of wheat is lower than last year.
"Thus, it will be more difficult to find top grade food quality wheat for exports compared to last year."
July upgrades
However, the comments came as influential forecasters within Russia raised hopes for exports for July, the first month of 2013-14, citing robust demand from North Africa and the Middle East.
SovEcon lifted its wheat export forecast from 700,000-800,000 tonnes to up to 1.0m tonnes.
Separately, Ikar raised its forecast for July shipments to 1.2m tonnes from a little over 1m tonnes, saying that 700,000 tonnes had already been exported.
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