Condition of winter crop areas, as well as the rates and agro-climatic conditions during the crops planting campaign, became one of the most important factors which influence the price situation on the Russian market of grains. To date, most market operators are monitoring the development of winter crops before beginning of the wintering period, in order to make a forecast about volumes and quality of the grain harvest in the new season, and prospects for spring re-planting works. At the same time, the key objective is to make adjustments to the strategy of further work.
While analyzing the price trends in October - early December of 2016/17 MY, we should note that the prices of wheat and barley somewhat increased, but in not very active way. The seasonal growth of demand from grain processing and export-oriented companies mainly assisted to increasing of the prices in the reporting period. Thus, the purchasing prices for milling and feed wheat increased by nearly 200-600 RUR/t (3-grade wheat, the European part – 11`000-11`500 RUR/t, Siberian Federal District – 10`200-10`800 RUR/t CPT), and feed barley – up 100-200 RUR/t (European part – 7`400-7`800 RUR/t, Siberian Federal District – 7`500-8`000 RUR/t CPT). At the same time, rates of the autumn planting campaign and the condition of winter crops areas did not have any significant effect on development of the price situation.
However, despite the absence of any significant problems with realization of the planting campaign in the autumn 2016, the current condition of winter crops areas remains one of the most relevant topics. The following comments of market operators can allow estimating the reporting situation.
Comments of agricultural producers
Vladimir Litvinov, Director at Helios LLC (Rostov oblast, Neklinovsky raion)
"It should be noted that during the planting campaign the weather conditions were not favorable. In the current year, the dates of planting works moved for 2 weeks due to the large number of precipitations, so we completed planting grains throughout several fields the third ten-day period of October, and it is rather late planting dates for our region. As a result, to date the crop areas are at the "pip" stage. At the same time, 30% of the crops areas are in the stage of 2-3 leaves, which is the most vulnerable phase in the case of stringent wintering conditions. But to date, the fight against mouse-type rodents is one of the most pressing problems for winter wheat in our region. In those fields where we planted winter crops at the optimum time and the tillering processes already started, and which faced abundant rainfalls, there mice began their massive attacks on crops. We need to solve the issue by either biological control technologies, or chemical ones. Generally, we estimate the current situation with the condition of winter crop areas, particularly winter wheat, as satisfactory."
Alexander Samsonov, Director at Rassvet CJSC (Krasnodar Krai)
"Generally, the planted areas of winter wheat and winter barley are in good condition. They will start the winter in normal mode, 50% of them will be in the tillering phase. According to the sanitation condition of winter crop field, to date we do not have any serious problems, and any diseases and pests do not make troubles to us. As a reminder, due to difficult weather conditions, the planting campaign somewhat delayed, and we started planting crops on September 25. and completed on October 26, while the agronomical dates specified the maximum date at October 10. We prefer using such winter wheat varieties, as Tanya, Yuka and Tabor, and winter barley - Khutorok."
Nikolai Gagolin, agronomist at Vozrozhdeniye LLC (Rostov oblast, Bagayevsky raion)
"Winter wheat at our fields has sprouted throughout all areas, all 330 ha. However, it happened in two phases. The reporting situation was caused by the fact that we planted crops throughout half of the areas on time, and the other half delayed for two weeks due to the harvesting campaign process. Generally, the condition of crops is good, but we managed to achieve such results largely through the use of plant growth regulator "Energy M". Previously, our company tested the regulator on spring barley, and received an increase of tillering rates, higher number of sprouts, higher yield, etc."
Igor Pleschenko, Agronomist at Stepnye prostory LLC (Rostov oblast, Zimovnikovsky raion)
"Winter crop completely sprouted at our fields, and in the current year the planted areas totaled 5100 ha. We started the planting campaign in the required agro-technical dates, and the moisture content was quite sufficient. If the snow covering is satisfactory, any problems with winter crops in the current season will not develop at all, and therefore, there will be no need to re-plant any crops in the spring."
Alexander Ril`, Director at the farming enterprise Ril`A.A. (Volgograd oblast, Kalachyovsky raion)
"In the current season, we have planted winter wheat only. Due to favorable weather conditions, the planted areas under wheat increased by 860 ha. I should note that our company has planted new crop varieties: Asket, Don 107, Don Don 93, Stanichnaya. As for the planting campaign dates, in the current year we completely met the standards, even despite the observed steady rains. At the current stage, the condition of winter crops is satisfactory, and causes no misgiving."
Buyer's opinion
Grain processors and exporters monitor the course of the autumn planting campaign, as well as winter crops condition, even more closely than agricultural producers. To date, many buyers are not afraid of any possible worsening of qualitative indicators of the future harvest. At the same time, some flour millers reported that due to the fact that the condition of crop areas is stable, they would return to its detailed monitoring in the spring only. "We do not have any wakeup calls from the fields, and this is good news. The demand and supply ratio of high-quality grains mainly brings pressure on formation of the current prices on the market. In terms of highly competitive rates in the flour milling market segment, the moderate growth of raw material prices allows making long-range planning of the work", - said a representative of the processing company in Tambov oblast.
In turn, many traders are focused on realization of the previously signed contracts, and inform that to date, price development on the global market, as well as importers demand, have even more significant impact on the price situation in Ukraine. At the same time, satisfactory condition of the crop areas does not provide any significant pressure on price formation.
Background information
According to the Ministry of Agriculture, in the current year agrarians planted winter crops for the harvest-2017 throughout the areas of 17.4 mln ha, or 100.1% of the forecasted planted areas (in 2015 - 16.3 mln ha). Rostov oblast (13% of the planted areas in 2016) became the leader of winter crops planted areas among all federal subjects, followed by Stavropol Krai (11%), and Krasnodar Krai (9%).
Traditionally, wheat takes the main share in the structure of crops planted areas. During 2 recent seasons, its share totaled nearly 85%, the share of barley and rye - 4% and 10%, respectively. In the current season, there are no significant changes in the structure of winter crops planted areas in Russia. It should be noted that winter crops plantings play a significant role in formation the general harvest of wheat. Despite the fact that the planted areas under spring and winter wheat are almost equal, the winter grain form nearly 70% of the general harvest volumes. Winter rye forms almost all varieties of the grain in Russia. As for barley, the share of winter varieties is rather small - no more than 7% of the general planted areas of the grain. Generally, its impact on formation of the grain harvest is not significant - winter barley forms nearly 10% of the general harvest of barley.
Polina Kalayda, Alexandrina Ovdienko, APK-Inform Agency
