Russia entered 23y with high carry-over stocks of wheat, which may remain at the end of the 22/23 season

MOSCOW, Jan 23 (Reuters) – Russia started 2023 with record carry-over stocks of grain and wheat amid a record harvest and limited exports as well. Analysts do not exclude a record for these indicators at the end of the 2022/23 season.

According to Rosstat, ending stocks of wheat in December 2022 amounted to 22.1 million tons compared to 13.8 million tons a year earlier.

Stocks of grain and leguminous crops increased compared to stocks in 2021 by 43.6% to 35.3 million tons, the agency said.

“Everything is going according to the plan we expect: record carry-over stocks by the end of the season (June 2023) are possible,” said Dmitry Rylko, head of IKAR.

They could provide support for the coming season, which now has “very serious concerns,” he said.

Analysts have previously warned about the impact on crops of sharp temperature changes this winter, accompanied by significant freezing of the topsoil and lack of snow cover and moisture. However, the Hydrometeorological Center still believes that the overwintering of winter crops is generally favorable.

The forecast for end-of-season wheat carry-over stocks from IKAR is 18 million tons. SovEcon has calculated that the reserves will amount to 16.2 million tons, as well as 2.9 million tons in the state intervention fund.

“Record stocks may put pressure on the domestic market in the second half of the first quarter of 2023… In 2023, the domestic wheat market may be oversaturated,” the SovEcon review says.

The grain harvest in Russia in 2022 amounted to 153.8 million tons compared to 121.4 million tons in 2021, of which wheat – 104.43 million tons compared to 76.1 million tons a year earlier.

Analysts raised their forecasts for wheat exports from Russia this season against the backdrop of fairly active shipments in recent months: SovEkon – up to 44.1 million tons, IKAR – up to 45.5 million tons.

However, as noted by SovEcon, the pace of exports in the first half of the season did not match the record harvest: from July to December 2022, 22.8 million tons of wheat were exported from Russia, compared with 24.8 million tons in the same period a year earlier.

The Ministry of Agriculture of the Russian Federation last week gave a forecast for grain exports in the season at 55-60 million tons and confirmed its intention not to reduce the export quota. (Olga Popova. Editor Marina Bobrova)

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