Yield exceeds all expectations

This year, according to the forecast of the President of the Russian Grain Union Arkady Zlochevsky, the grain yield in the Russian Federation will not be less than 140 million tons. For comparison: the previous record harvest was in 2017 and amounted to 135.4 million tons.

As Arkady Zlochevsky explained during a press conference at the Rossiya Segodnya news agency dedicated to the preliminary results of the 2022 harvesting campaign, this was largely due to favorable weather conditions:

“Even if we subtract all possible additions (7-8 million tons), we still have a record harvest this year. Analysts are now generally talking about a crop of 150 million tons. About 100 million tons of this crop is wheat. That is, there is also a lot of wheat this year.”

Moreover, according to the President of the Russian Grain Union, in some cases such a high yield even has a paradoxical character that is difficult to explain:

“Many peasants (and there are many of them) told me that there were situations when fertilizers were not applied to some fields due to lack of financial resources, but the crops were produced and the harvest was harvested from there. The paradox is that on the unapplied fields, the yield turned out to be even higher than on the fields that they “fed” with fertilizers.”

At the same time (with such a fantastic yield), as Arkady Zlochevsky noted, the quality of the crop also exceeds all expectations and forecasts:

“At the beginning of the harvest, everyone said that there would be solid fodder. And now, at the end of the harvest, it turns out that the quality is getting better and better. The indicators are getting better and better in terms of the quality of wheat.”

At the same time, as Arkady Zlochevsky recalled, “there are two troubles in Russia – a crop failure and a harvest,” and the second of them, in terms of its consequences, can be (at least for producers) harder than the first:

“The harvest may turn out to be a bigger disaster, and so it happened: prices have already collapsed to an absolutely unacceptable level and are now at the cost price level. For this reason, the peasants are not ready to sell and store grain in warehouses, waiting for better times. This is due to a whole range of factors. Demand has shrunk like “shagreen leather”. The main support for the market in the autumn period is traditionally export, but this year our export “vacuum cleaner” is spinning very slowly. That is, the domestic market is not currently served by exporters at the proper pace. In total, since the beginning of the season (from July 1 to October 15), we have shipped 16.8 million tons, which is almost 13% less than last year (at that time it was 19 million tons). This is a serious backlog, and at the same time, such a huge volume of resources has formed on the territory of the country that the need for export at a much higher rate is obvious.

According to the President of the Russian Grain Union, now it is necessary to ship 6 million tons for export every month, as difficult weather conditions for shipments will come. Some activation of exports in October occurred, according to him, due to the weakening of the ruble. However, this trend is unlikely to be long-term due to an increase in duty by almost 50%, which will occur due to the same weakening of the ruble (this is how the damper mechanism introduced by the Russian government works) and due to an increase in the discount on our shipments.

“In general, we need to export at least 60 million tons of grain in a good way, but at the current shipment rate, such indicators are unattainable. And all this ultimately leads the market to very low domestic prices: now the prices for wheat of the 4th grade in the regions of the Russian Federation are falling below the cost at a cost of 10 thousand rubles per ton. This is already a very painful process,” said the President of the Russian Grain Union.

The consequences of this “painful process”, as Arkady Zlochevsky noted, have already begun to negatively affect the pace of winter sowing:

“Winter sowing is already lagging behind (due to the lack of necessary financial resources from peasants and farms. – S.I.), and when the Ministry of Agriculture says that this is due to not very favorable weather for winter sowing, it sounds very strange, because it turns out that the weather is wonderful for harvesting, but for some reason not for sowing … But it’s not happens”.

It is obvious that the winter sowing is behind schedule not for weather, but for economic reasons, and all this will negatively affect the fate of the future harvest.

Sergei Ishkov.

Photo mcx73.ru