Grain export prices of January 07, 2020

Summary table of prices for cereals and flour in tenge per ton for Kazakhstan as on 07.01.2020, including VAT 12%

Name of the area

grade 3 wheat, with gluten

wheat grade 4

wheat grade 5

barley

Flour

23-24%

27-30%

top grade

1 grade

2 grade

Akmola

78000

83000

63700

56700

52200

134500

120000

103500

Aktobe

81900

67900

60900

53900

138000

123500

109000

Almaty

80000

65200

58200

54300

136200

121700

107200

East Kazakhstan

78800

64900

57400

53600

135000

120500

107000

Zhambyl

79600

65000

58000

55300

137000

122500

108000

West Kazakhstan

79400

65200

58200

136700

123200

108700

Карагандинская

80700

85000

66900

59900

52500

135500

121000

106500

Kyzylorda

81400

66600

60900

136700

122200

108700

Kostanay

78600

83700

64300

57300

52700

133500

119000

104500

Pavlodar

78800

65500

57500

52600

134600

120100

105600

North Kazakhstan

77300

84300

63000

55800

52200

132500

118000

103500

Turkestan

79700

84800

65100

58100

54600

137100

122600

108100

Nur Sultan

78300

83900

65000

57200

135400

120900

106400

Almaty city

81100

66600

59600

137600

123100

107600

Export prices for grain crops and flour in dollars per ton, incl.  VAT 0% (ex-elevator) as of January 07, 2020

Station name

grade 3 wheat, with gluten

wheat grade 4

wheat grade 5

barley

Flour

Delivery conditions

23-24%

27-30%

2 класс

top grade

1 grade

2 grade

Sale

Sale

Sale

Sale

Sale

Sale

Sale

Sale

Art. Petropavlovsk (South Ural Railway)

225-228

252-255

215-218

147-150

317-322

283-288

258-263

DAP

Sary agash

244-247

271-274

234-237

166-169

336-341

302-307

277-282

DAP

Lugovaya

240-243

267-270

230-233

162-165

333-337

298-303

273-278

DAP

Tobol

234-237

261-264

224-227

156-159

326-331

292-297

267-272

DAP

port of Aktau

254-257

281-284

244-247

176-179

346-351

312-317

287-292

FOB

Bekabad

268-271

295-298

258-261

190-193

360-365

326-331

301-306

СРТ

Hiraton

298-301

325-328

288-291

220-223

390-395

356-360

331-336

СРТ

Turgundi

295-298

322-325

285-288

217-220

387-392

353-358

328-333

СРТ

Sarahs

222-225

 

Over the year, December to December 2018-19, the cost of wheat on the EXW supplier’s basis increased significantly. This is especially true for high-protein wheat with a gluten content of 27-30%. Its price increased by 25,600 tenge per ton. This type of cereal has the highest growth rates among other wheat classes. But the smaller the class of wheat, the lower the growth dynamics. Grade 3 wheat increased by 23100 tenge per ton. Grade 5 forage wheat grew the least. Against the background of wheat barley rose much more modestly – only by less than 5%. But among the wheat-flour range of goods, the absolute leader of the increase was flour of the highest grade – almost 60% of last year ‘s price indicators. The absolute growth of flour of the highest grade for the year – 50000 tenge per ton, the analyst “КазахЗерно.kz” states. Just like wheat, flour’s growth proportions decrease with the fall of the variety. See below for detailed figures.

World market

Calendar 2019 ended. During the year the dynamics of the urgent market had different directions, but by the end of the year exclusively in a positive direction. The growth of wheat quotations in the world continued throughout the autumn period. December was no exception either. This time, British wheat quotations became the leader of relative growth. In a smaller proportion, wheat contracts from France rose. Quotations in the US slightly did not get three percent of the growth, but nevertheless, they crossed up the limits of 200 dollars per ton and surely there fixed. Still by price absolute denominator all are ahead of French quotations. American corn and soybean rose following their wheat, the former to a lesser degree and the latter to a greater extent.

Wheat quotations have changed mixed over the year. According to data at the end of December 2018-19 in the USA they grew, and in Europe decreased to different degrees. In the United States, wheat quotations rose by $16.7 per ton, or 8.9%, in Britain fell by $26.7 per ton, or 12.2%, and in France by $21.9 per ton, or 9.4%. American corn and soybean strengthened their position in a year.

For December 2019, in the currency market, the dollar lost its exchange rate advantages to the pound, and especially to the euros it acquired in November, and declined to those currencies. To the pound, the dollar fell from 0.7747 pounds per dollar on November 30 to 0.7674 pounds per dollar on December 28, and to the euro from 0.9083 to 0.8985 euros per dollar, respectively. The International Grain Council (IGC) makes no forecasts in December, and on November 21 for the 2019-20 season raised the grain production forecast by 5 million tons, from 2,157 to 2,162 million tons, and the consumption forecast by 4 million tons, from 2,184 to 2,188 million tons. The seasonal balance of production – grain consumption remains scarce. In more detail further.

Expert Forecasts

In December, the USDA forecast for world wheat production for the 2019-20 season was reduced from 765.55 to 765.41 million tons, consumption was reduced from 755.17 to 753.76 million tons. The export level was reduced from 180.68 to 179.81 million tons, but the ending carry-over stocks of the season were increased from 288.28 to 289.50 million tons. The forecast for wheat production among its main exporters has increased for Russia and the European Union, decreased for Argentina, Australia and Canada. For the United States and Ukraine, the forecast remained the same.

On November 21, in its report, the International Grain Council (IGC) raised the forecast of world grain production in 2019-20 season by 6 million tons, from 2,157 to 2,162 million tons, the forecast of consumption increased by 4 million tons, from 2,184 to 2,188 million tons. The volume of grain trade is expected to be 375 million tons, with an increase of 1 million tons by the October forecast. The final rolling reserves of the season increased by 2 million tons, from 592 to 594 million tons. This season they are 16 million tons lower than last year.

Separately, for wheat, the October forecast did not change in November for all indicators. Wheat production will amount to 762 million tons, consumption of 756 million tons. The level of trade is 176 million tons. Final moving stocks – 271 million tons. This season the wheat balance will exceed the level of last season s balance by 6 million tons.

Forecasts for the world ‘s maize balance are optimistic about the level of production, consumption and final balances of the season. For the 2019-20 season, IGC increased the maize production forecast by 5 million tons, from 1,098 to 1,103 million tons, the consumption forecast increased by 4 million tons, from 1,138 to 1,142 million tons, and final rolling balances increased by 1 million tons, from 278 to 279 million tons. Only the level of trade remained unchanged – 168 million tons.

Forecasts for rice have changed slightly, and production has remained at past levels. In November, production forecast amounted to 500 million tons, consumption forecast decreased by 1 million tons, from 496 to 495 million tons, final balances forecast, on the contrary, increased by 1 million tons, from 179 to 180 million tons. The level of trade dropped by 1 million tons, from 46 to 45 million tons.

Dynamics of the urgent market for wheat, maize and soybean in December

The results of the week from November 29 to December 6 became negative for wheat quotations in the United States and Britain. Quotations in these countries fell after rising a week earlier. The situation in France is mixed. Here, near-December contracts on the eve of their upcoming closure gained weight, and more distant March contracts, on the contrary, decreased. American corn and soybean changed their trend last week. Corn dropped after the rise and soybean rose after the fall. In a week, the dollar sat significantly to the euro and the pound, adding value to European quotations in its equivalent.

From December 6 to December 13, wheat quotations in the US rose after falling a week earlier. French wheat quotations were thrown all week in different directions, but eventually remained at the same level. In Britain, wheat added just over half a percent to its value. American corn and soybean finished the week growing, corn to a lesser extent, and soybean to a greater extent. Last week, the dollar in the foreign exchange market literally fell to the pound and the euro and raised the values of European quotations in its equivalent

Wheat quotations in the United States increased in equal proportion to French quotations for the week of December 13 to 20. In Britain, wheat contracts have increased in higher dynamics. American corn and soybean repeated the path of their wheat in one to the same extent. In the foreign exchange market, the dollar played its position in a week with growth to the euro and the pound. European quotations lost additional values in the American denomination.

The last week of the year, from December 20 to December 27, took place under the sign of increasing wheat quotations in Europe and the United States. On European exchanges, growth was more than one and a half percent, and Chicago was more than two and a half percent. Against the background of wheat dynamics, changes in American corn and soybeans are not so significant. Corn declined over the period and soybean rose. During the week, the dollar weakened against the euro and the pound. This additionally gave an incentive to advance American wheat quotations.

As a result, in the dollar equivalent from November 29 to December 27 in London wheat quotations increased by 3.6%, in Paris by 3.2%, and in Chicago by 2.8%. Corn in the US rose 2% and soybean on the 7.9%. In the nominal euro, rapes in Paris rose by 6%, and corn eventually did not change.

Dynamics of wheat, maize and soybean quotations on world exchanges from November 29 to December 27 (in dollars per ton)

29.11 06.12 13.12 20.12 27.12 29.11-27.12 + — 29.11-27.12 %
Wheat              
SBT Chicago 199 192,7 195,6 199,2 204,6 5,6 102,8
LIFFE London 185,4 183,9 189,1 188.7 192 6,6 103,6
MATIF Paris 204,1 206,4 203,9 207,4 210,7 6,6 103,2
Corn CBT 149,8 148 149,7 152,4   152,9 3,1 102,0
Соя СВT 322,1 326,8 338,6 344,7 347,6 25,5 107,9

Rapeseed and maize quotes on MATIF from November 29 to December 27 (in euros per tonne)

29.11 06.12 13.12 20.12 27.12 29.11-27.12 + — 29.11-27.12 %
Рапс, MATIF 390,25 396,5 400 408,75 413,5 23,25 106,0
CornMATIF 166 164,75 165,75 161,75 166 0 100,0

Cash market for agricultural products FOB in December

In December, in the FOB market, wheat prices in the United States, France, and Russia rose between $7 and $10 per ton. The maximum growth rates for American hard wheat HRW are 11% and for food Russian wheat. Less price gain for French wheat and for soft wheat SRW and high-protein HRS 14% from the United States. The situation in barley is mixed. French barley shifted slightly up and Russian barley down in higher dynamics. Maize from the United States and Russia also grew. American and Argentine soybeans have increased almost equally.

In the first part of December, prices of wheat and barley in the cash FOB market in the ports of the United States, France and Russia moved in different directions, and some positions did not change at all. Came out with a zero total by December 13 wheat from France and high-protein wheat HRS 14% from the United States. SRW wheat from the United States increased slightly, but solid HRW wheat dropped 11% to a greater extent. Russian wheat rose and is now six dollars a ton ahead of French grain. Barley from France and Russia has dropped, almost in the same proportion, Russian barley retains a higher price appeal. American corn lost a couple of dollars a ton in two weeks, and Russian corn increased as much. Unlike wheat, barley, and maize, the soy segment has significantly strengthened its position, in the United States to a lesser extent, and in Argentina to a greater extent.

In the second part of December in the FOB market the increase in prices of cereals and soybeans became more obvious and unambiguous than in the first half of this month. The exception was only Russian barley, which lost a couple of dollars during the period. All kinds of American wheat have strengthened their position. SRW wheat and high-protein HRS are 14% equally, and HRW hard wheat is 11% in higher dynamics. French wheat increased significantly after downtime in early December. Russian wheat followed French, but grew to a lesser extent, reducing the price difference between these grains. French barley, unlike Russian barley, rose by a couple of dollars. Now the price difference between French and Russian barley is $7 in favor of the latter. American and Russian corn have increased equally. Soya and the United States and Argentina continued their march up in the second half of December.

As a result, in just December from November 29 to December 27, SRW wheat at the FOB base from ports in the United States increased by $8, from 242 to $250 per ton. HRW wheat with 11% protein rose by $10, from $225 to $235 per ton. HRS high-protein wheat rose $7, from $270 to $277 per ton. Corn in US ports rose by $3, from $173 to $176 per ton.

The French wheat in the port of Rouen rose from November 29 to December 27 by 8 dollars, from 208 to 216 dollars for ton. Barley from France rose by $1, from $190 to $191 per ton. Russian wheat in Black Sea ports grew by $10, from $210 to $220 per ton. Russian barley on the Black Sea basis fell by $4, from $188 per ton. Corn from Russia increased by $7, from $170 to $177 per ton.

Soy from the USA on basis of FOB rose by 17 dollars, from 349 to 366 dollars for ton, and soy from Argentina for 19 dollars, from 350 to 369 dollars for ton.

Price dynamics of FOB cash market from November 29 to December 27 for agricultural crops in the USA, France, Russia and Argentina, in dollars per ton

cereal crop    The country 29.11 06.12 13.12 20.12 27.12 29.11-27.12 + —
Wheat SRW USA 242 239 243 247 250 8
Wheat  HRW 11% USA 225 215 220 228 235 10
Wheat HRS 14% USA 270 269 270 273 277 7
Wheat France 208 207 208 211 216 8
Wheat Russia 210 212 214 216 220 10
Barley France 190 189 189 188 191 1
Barley Russia 188 188 186 184 184 -4
Кукуруза USA 173 170 171 175 176 3
Кукуруза Russia 168 167 170 174 175 7
Соя USA 349 349 358 367 366 17
Соя Аргентина 350 356 365 372 369 19

Russia

In December, rye became the price leader in the Russian grain market among the main cereals. Already in early December it overtook in absolute price traditionally the most expensive wheat of class 3, and further within a month only increased the price gap in its favor. By the end of December, the price of food rye exceeds the cost of grade 3 wheat by more than a thousand rubles per ton. The wheat segment of Russia ‘s grain market became more expensive in a month in domestic currency by two and a half percent or more. Grade 4 wheat, a slightly smaller proportion of the forage component of wheat, advanced the most up. Corn increased in about proportions commensurate with wheat, and fell out of the overall growth trend only barley, it lost several tenths of a percent, but at the same time increased in dollar values, thanks to the strengthening of the ruble against the dollar.

In the foreign exchange market in the first part of December the dollar decreased from 64.08 rubles per dollar as of November 30 to 62.5544 rubles per dollar as of December 14, then in the second half of December the dollar fell again, now from 62.5544 rubles per dollar as of December 14 to 61.7676 rubles per dollar as of December 27. Such a course significantly increased the dynamics of Russian cereals in American currency. The strengthening of the ruble shadows up the export cash prices of Russian cereals and reduces their competitiveness in world markets. This is evident from the growth of export prices for Russian wheat and corn on the FOB basis.

Harvest – 2019

The last account on the results of harvest-2019 appeared in the agricultural department of Russia on December 6. Recall, as of this date, according to the operational data of the agribusiness management bodies of the constituent entities of the Russian Federation as a whole, cereals and leguminous crops are frozen from an area of 45.3 million hectares, or 96.8% to the sown area (In 2018 – 44.5 million hectares), 126.7 million tons of grain (116.6 million tons in 2018) with a yield of 28 c/ha (26.2 c/ha in 2018).

Dynamics of prices for Russian crops in December

In the first half of December, Russian grains continued to rise, and the falling dollar exchange rate drove them up additionally, since dollar prices are traditionally tied to the Russian equivalent. Grade 3 and 4 food wheat increased almost equally in absolute and relative terms. But the growth of feed wheat was higher in dynamics. The food rye continues to amaze by the strengthening of its values. After the November increase, it did not weaken in the increase at all and again became the growth leader, an order of magnitude ahead of its grain competitors. Other feed crops, such as barley and corn, rose slightly in rubles relative to other crops, but the reduced dollar exchange rate gave them a solid increase in international trade equivalent.

In the second part of December, crops in Russia rose again, except for barley, which fell slightly, but only in rubles. Further strengthening of the Russian currency, as in the first half of December, was an additional factor in the strengthening of grain prices in the equivalent of the dollar. The phenomenal growth of food rye continues. In the first part of December, it was ahead of wheat of the 3rd class in absolute price indices, and in the second part of the month it consolidated its leading price positions. By the end of the year, it is the most expensive grain crop in Russia. In the wheat segment, Grade 3 decreased the degree of growth and increased in less dynamics than Food Grade 4 and feed wheat. Feed barley remains a relatively stable crop; its insignificant growth in the first half of December smoothly flowed into a slight decrease in its second half. By the end of December, corn, on the contrary, gained pace of price development.

From November 29 to December 27 in Russia wheat of class 3 increased by 310 rubles per ton, or 2.6%, wheat of class 4 by 335 rubles per ton, or 3.2%, and fodder wheat by 445 rubles per ton, or 4.1%. Food rye rose by 1,555 rubles per ton, or 13.1%, barley dropped by 35 rubles per ton, or 0.4%, and corn increased by 330 rubles per ton, by 3.6%. Peas grew by 685 rubles per ton, by 5.6%.

Dynamics of grain prices in the European part of Russia from November 29 to December 27, RUB/ton on EXW basis including VAT

Grain crops 29.11 06.12 13.12 20.12 27.12 29.11-27.12 + — 29.11-27.12 %
Grade 3 wheat (p. 23%) 12 005 12 135 12 190 12 235 12 315 310 102,6
Wheat 4 classes 11 215 11 340 11 395 11 450 11 570 355 103,2
Food rye 11 860 12 710 12 710 12 790 13 415 1555 113,1
Feed wheat 10 785 10 920 11 045 11 155 11 230 445 104,1
Feed barley 9 965 9 970 9 970 9 955 9 930 -35 99,6
Feed corn 9 245 9 280 9 305 9 400 9 575 330 103,6
Peas 12 195 12 195 12 560 12 880 12 880 685 105,6

From November 29 to December 27 in the American equivalent wheat 3 classes rose by 11.2 dollars for ton, for 6%, wheat 4 classes for 11.5 dollars for ton, or for 6.6%, fodder wheat for 12.7 dollars for ton, for 7.5%. Rye increased by $31.2 per ton, by 16.9%, barley by $4.6 per ton, by 3%, and corn by $10.1 per ton, by 7%. Peas rose $17.3 a ton, or 9%.

Dynamics of grain prices in the European part of Russia from November 29 to December 27, dollars/ton on EXW basis including VAT

Grain crops 29.11 06.12 13.12 20.12 27.12 29.11-27.12 + — 29.11-27.12 %
Grade 3 wheat (p. 23%) $187,3 $190,4 $194,9 $196,1 $198,5 11,2 106,0
Wheat 4 classes $175,0 $178,0 $182,2 $183,5 $186,5 11,5 106,6
Food rye $185,1 $199,5 $203,2 $204,9 $216,3 31,2 116,9
Feed wheat $168,3 $171,4 $176,6 $178,7 $181,0 12,7 107,5
Feed barley $155,5 $156,5 $159,4 $159,5 $160,1 4,6 103,0
Feed corn $144,3 $145,6 $148,8 $150,6 $154,4 10,1 107,0
Peas $190,3 $191,4 $200,8 $206,4 $207,6 17,3 109,0

The tables used information from the ProZerno agency.

Price results of grain market in 2019

For calendar year 2019, prices for most Russian cereals decreased in ruble equivalent. The exception was only food wheat, which showed higher price values in 2019 than in 2018. As of December 28, 2018, food rye was estimated at 9080 rubles per ton, and as of December 27, 2019 at 13415 rubles per ton. As a result, the growth by 4,335 rubles per ton, or 47.7%.

The remaining grain crops reduced their price indicators in different relative and absolute proportions. The most lost barley – 2580 rubles per ton, or 20.6%. Grade 3 wheat fell by 1,050 rubles per ton, or 7.9%, grade 4 wheat by 770 rubles per ton, or 6.2%, and forage wheat by 315 rubles per ton, or 2.7%. Corn decreased by 1,035 rubles per ton, or 9.8%.

Comparative price table at end of December 2018-19

Grain crops 28.12 2018 27.12    2018 2019 2018 + — 2019 2018 %
Grade 3 wheat (p. 23%) 13 365 12 315 -1050 92,1
Wheat 4 classes 12 340 11 570 -770 93,8
Food rye 9 080 13 415 4335 147,7
Feed wheat 11 545 11 230 -315 97,3
Feed barley 12 510 9 930 -2580 79,4
Feed corn 10 610 9 575 -1035 90,2
Peas 12 255 12 880 625 105,0

Dynamics of Russian grain in December on the export market

Cash Russian wheat in the Black Sea ports on the FOB basis increased by $ 10, from $ 210 to $ 220 per ton. Russian barley on the basis of the Black Sea fell by $ 4, from $ 188 to $ 184 per ton. Corn from Russia increased by $ 7, from $ 170 to $ 177 per ton. By the end of December, Russian wheat on the FOB market is four dollars more expensive than French wheat, but Russian barley is five dollars cheaper than French barley.

Grain Export

The Russian government has changed the rules for subsidizing the transport of agricultural products and food. If transportation from 62 regions of the country was subsidized before, now there are no such restrictions. Also, according to the new version of the document, water, rail and road transport will now be subsidized, whereas previously only rail and rail transport using road transport were subsidized.

According to the FCS, grain exports in the current agricultural season as of December 23, 2019 amounted to 23.2 million tons, which is almost 16.6% lower than the same indicator of the last 2018-19 season, when 27.9 million were exported abroad. . tons of grain. Including sold wheat – 20.1 million tons, barley – 1.9 million tons, corn – 1.1 million tons.

Kazakhstan

​​ Over the past year, the price of wheat of all classes has increased markedly, and even more so the price of the main product of its processing – flour. Grain producers and flour mills should be pleased with this fact. But against this background, low volumes of grain availability are upsetting. Grain harvest in the past year was not as rich as last year, and free grain for sale became much less. Foreign and local experts agreed that export of grain and flour in commercial volume will significantly decrease. Whether higher prices in the monetary denominator will be able to compensate for the missing volumes is not yet known. Much will depend on the further development of the situation in the world and neighbouring markets. In the meantime, grain holders are waiting for even better prices.

Grain harvest in 2017-19

​ As already reported in the last report, as of November 29, all grain-eating regions showed a 100% result of the harvesting campaign. According to the regional departments of agriculture, as of November 29, 15274.2 thousand hectares were harvested and 19727.4 thousand tons of grain with an average yield of 12.9 c/ha. Last year, 15073.7 thousand hectares were removed and 22844.1 thousand tons were collected with a yield of 15.2 c/ha.

In terms of individual regions, three regions of the grain belt of Kazakhstan received the largest harvest. Of the twelve grain-producing regions, more than 1 million tons of harvest took place in four regions of the Republic. Akmola region – 5124.1 thousand tons, North Kazakhstan region – 4794.3 thousand tons, Kostanay region – 3002.7 thousand tons and Almaty region – 1429.44 thousand tons. The smallest crop harvest in West Kazakhstan region is 249 thousand tons.

The number of areas where the harvest volume decreased and increased relative to the previous year was divided by exactly half. In six regions, the harvest declined and in six increased. The decline in harvest in the largest cereal regions has led to an overall negative result.

In 2019, grain harvesting was completed later and collected less grain than in 2017 and 2018, by 2545.4 and 3082.6 thousand tons, respectively. As of November 7, 2018, according to operational information on the harvest of cereals and legumes, 100% of the grain area, or 15059.7 thousand hectares, was harvested. 22810 thousand tons were filled. In 2017, 22272.8 thousand tons were received from a larger area of 15359 thousand hectares. This result was obtained due to higher yields in 2018 of 15.1 centners per hectare compared to 14.5 centners per hectare in 2017.

Cereal crop harvest in 2017-19, thousand tons

  2017 2018 2019 2019 к 2019 + —
Grain yield 22272,8 22810 19727,4 -2545,4

Forecasts of experts

In the December report of Agricultural Service USDA for Kazakhstan in 2019-20 season, data on wheat production and export remained the same. According to Agricultural Service USDA, wheat production was last reduced from 13 to 11.5 million tons. This is the lowest rate of production of this grain in six years. Last 2018-19 season, production was 13.947 million tons. Wheat exports from Kazakhstan were reduced from 6.5 to 5.2 million tons. Last season, according to this expert group, wheat exports were at 8.3 million tons. And in 2017-18 marketing year exports amounted to 9 million tons. The final reserves of the current season – only 1.44 million tons – are predicted to be extremely low.

In the latest report of the International Grain Council (IGC) in 2019, published on November 21, the forecast of grain production in Kazakhstan for 2019-20 season remained unchanged – 16.8 million tons. Meanwhile, in 2018-19 season the harvest was 2.4 million tons more significant. A year earlier, Kazakh farmers collected 19.3 million tons from their fields.

For some items, the forecast data changed in November. The level of domestic consumption of grain has been increased by increasing its expenditure on fodder purposes, and the level of export has been reduced. A total of 16.8 million tons will be received in 2019-20 season in Kazakhstan with initial reserves of 2.3 million tons, imports will amount to 1.1 million tons, seasonal grain balance will amount to 20.2 million tons, of which 9.9 million tons will be spent on food, fodder and technical purposes within the republic (9.8 million tons in the October forecast). Exports were reduced by 0.1 million tons, from 8.1 to 8 million tons, and final reserves would remain at 2.3 million tons.

Separately on wheat the forecast of November for Kazakhstan has not changed. With initial reserves of 1.8 million tons, the harvest will be 11.5 million tons. 1 million tons will be imported and the seasonal balance is estimated at 14.3 million tons. Consumption will take 6 million tons and export 6.7 million tons. As a result, final balances will fall to 1.7 million tons. Compared to last year wheat production will decrease by 2.4 million tons, imports will increase by 10 times, consumption will fall by 0.4 million tons, and exports by 2 million tons.

Grain and flour price dynamics from December to December 2018-19

During the period from December to December 2018-19, the price of high-protein wheat with gluten content of 27-30% on the EXW basis of suppliers of Akmola region increased by 25,600 tenge per ton ($64.9), from 57,900 ($153.9) to 83,500 tenge per ton ($218.8), or 44.2%. Wheat class 3 23% rose by 23100 tenge per ton($58.4), from 55400 ($147.2) to 78,500 tenge per ton ($205.6), or 41.7, grade 4 wheat – 12300 tenge per ton ($30.2), from 52400 ($139.3) to 64,700 tenge per ton ($169.5), or 23.5%, and grade 5 wheat – by 8,300 tenge per ton ($19.9), from 49,400 ($131.3) to 57,700 tenge per ton ($151.2), or by 16.8%. Barley increased by 2,100 tenge per ton ($3.6), from 49,600 ($131.8) to 51,700 tenge per ton ($135.4), or 4.2%.

Flour in/s increased by 50000 tenge per ton ($127.8), from 84500 ($224.6) to 134500 tenge per ton ($352.4), or per 59.2%, flour of 1 grade – per 38000 tenge per ton ($96.4), from 82,000 ($218) to 120,000 tenge per ton ($314.4), or 46.3%, and flour of grade 2 – 24,000 tenge per ton ($59.9), from 79,500 ($211.3) to 103,500 tenge per ton ($271.2), or 30.2%.

Grain and flour prices in December 2018-19, in tenge

Type of goods December 2018              December 2019 2019 к 2018 + — 2019 к 2018 %
wheat 27-30% 57900 83500 25600 144,2
grade 3 wheat 55400 78500 23100 141,7
4th grade wheat 52400 64700 12300 123,5
5th grade wheat 49400 57700 8300 116,8
barley 49600 51700 2100 104,2
premium flour 84500 134500 50000 159,2
flour 1 grade 82000 120000 38000 146,3
flour 2 grade 79500 103500 24000 130,2

The dynamics of growth of cereals and flour in the equivalent dollar lags behind the proportion of fall in the national currency due to the decline in the exchange rate of tenge to the dollar for the year. At the end of 2018, the dollar was estimated at approximately 376 tenge per dollar, and at the end of December almost 382 tenge per dollar. The dollar ‘s rise is about a 1.5%. But the increase in the dollar to tenge played a very small role in the pricing of grain and flour. The main factor of price growth is the world, regional and local grain market conditions.

Grain and flour prices in December 2018-19, in dollars

Type of goods December 2018              December 2019 2019 к 2018 + — 2019 к 2018 %
wheat 27-30% 153,9 218,8 64,9 142,2
grade 3 wheat 147,2 205,6 58,4 139,7
4th grade wheat 139,3 169,5 30,2 121,7
5th grade wheat 131,3 151,2 19,9 114,7
barley 131,8 135,4 3,6 102,7
premium flour 224,6 352,4 127,8 156,9
flour 1 grade 218,0 314,4 96,4 144,2
flour 2 grade 211,3 271,2 59,9 128,3

​As we see from the last table, the dynamics of grain crops growth in the American nominal value is lower than in tenge, by about 2%. These percentages account for the costs of the currency market as a result of fluctuations in the rate of tenge/dollar. If we compare prices of Kazakhstan cereals with prices of cereals in the European part of Russia, the picture is different. Kazakhstan wheat of class 3 is more expensive than the same Russian wheat by almost seven dollars. But for other wheat and barley Kazakhstan prices are inferior to Russian indicators. This is due to the different structure and volume of domestic grain consumption and exports in Russia and Kazakhstan.

It should be noted that wheat prices did not grow in the same progression during the year. Moreover, the values of the end of December are not the highest in 2019. Take, for example, grade 3 wheat (see dynamics below). Its first rise took place in February 2019 against the background of increased exports, traditional for this time of year. The price held at a relatively high level with a gradual decline up until June. But in July and August, the price fell in anticipation of a good harvest, or at least comparable to last year. During the disadvantaged harvesting campaign, these expectations dissipated and in September-October prices for grade 3 wheat jumped to almost 80 thousand tenge per ton. Then the excitement began to fade a little, and wheat prices began to crawl slowly down, but not far away.

Wheat and flour prices from December 2018 to December 2019 

Type of goods December 2018              February April June August September October November December 2019 2019 to2018 + — 2019 to 2018 %
wheat 27-30% 57900 73900 73200 72200 68200 76200 84700 84200 83500 25600 144,2
grade 3 wheat 55400 71400 70700 69700 62700 71700 79700 79200 78500 23100 141,7
4th grade wheat 52400 66400 65700 64700 58700 62700 66700 65700 64700 12300 123,5
5th grade wheat 49400 63400 62700 61200 54200 55700 59700 58700 57700 8300 116,8
barley 49600 62600 62000 60000 50000 50000 51000 51500 51700 2100 104,2
premium flour 84500 99500 99500 99500 92500 102500 132500 134500 134500 50000 159,2
flour 1 grade 82000 97000 97000 97000 90000 98000 118000 12000 120000 38000 146,3
flour 2 grade 79500 94500 94500 94500 85500 91500 101500 103500 103500 24000 130,2

Grain stocks

As of December 2019, grain reserves in Kazakhstan are formed in a much lower volume than in previous years. As of December 1, 2017, grain reserves in Kazakhstan were at 20008473 tons and are decreasing by 2,297,992 tons, or 11.5%, during the month. As of December 1, 2018, grain reserves in Kazakhstan reach the level of 15794352 tons with a decrease of 2707983 tons, or 14.6%. By 1 December 2019, the statistics recorded 13172139 tons of grain with a decrease of 2428494 tons or 15.6% in November. Thus, in December 2019 grain is less than in 2017 by 6836334 tons, and in comparison with 2018 by 2622213 tons.

Cereal reserves in 2017-19 as of December 1 in tons  

  2017 2018 2019 2019 to  2019 + —
Grain reserves 20008473 15794352 13172139 -2622213

​​ In November, until December 1, 2019, grain reserves decreased in almost all regions and cities of republican subordination with the exception of Atyrau region, in which grain volumes increased during the month. In November, the dynamics of the regional balance sheet structure was not quite normal. Always grains during cleaning most arrive in the three northern regions. Accordingly, more are removed from these areas. In November, Akmola region overtook Almaty region in terms of grain loss. From here in a month left almost half of grain reserves of this area, and to be precise – 48%.

​ We remind that by the beginning of the new season 3991767 tons were recorded in Kazakhstan with a decrease of 1302697 tons, or 24.6%. In July, grain reserves in Kazakhstan decreased from 3991767 to 3468869 tons, by 522898 tons, or 13.1%. In August, grain volumes increased from 3468869 to 5106469.5 tons, by 1637600.5 tons, or 47.2%. In September by October 1, the number of grains increased from 5106469 to 12654519 tons and increased by 7548049 tons, or 2.45 times. During October the grain became more by another 2946114 tons, up to 15600633 tons, or 23.3%. By December 1, the statistics accounted for 1,3172139 tons of grain with a decrease of 2,428,494 tons, or 15.6%, for November.

The quantity of food grain decreased from 11452268 tons at the 1 of November to 9446763 tons at the 1 of December, by 2005505 tons, or by 17.5%. Seed grain stock grew in volume from 1331427 to 1431380 tons, by 99953 tons, or 7.5%, and fodder grain reserves decreased from 2,816,937 to 2,293,996 tons, by 5,22941 tons, or 18.6%.

For November by December 1 volumes of wheat decreased by 1455162 tons, from 11328179 tons for November 1 up to 9873017 tons for December 1, or for 12.8%, corn – by 106232 tons, from 320284 to 214052 tons, or for 33.2%, rice – by 133040 tons, from 451837 to 318797 tons, or for 29.4%. Barley decreased by 581783 tons, from 2835157 to 2253374 tons, or 20.5%, rye by 6205 tons, from 20872 to 14667 tons, or 19.7%, oats by 86688 tons, from 283308 to 196620 tons, or 30.6%. Buckwheat became smaller by 9,333 tons, from 51,814 to 42,481 tons, or 18%, millet – by 5,552 tons, from 24,774 to 19222 tons, or 22.4%, and mixture of colos – by 10,957 tons, from 67,868 to 56,911 tons, or 16.1%.

In November, the arrival of grain from the fields is stopped, and the grain balance of Kazakhstan is in the mode of volume reduction. That was the case last year. In November, grain traditionally decreases more than the average in the following months, as during this period the processes of grain reprocessing during its drying and cleaning take place most actively. Last year, grain volumes for November decreased in a smaller proportion, but in large absolute values, as grain as of November 1, 2018 was more by almost 3 million tons than as of November 1, 2019.

To date, the following domestic prices have been established:

At the moment in the capital of the republic, Nur Sultan, wheat of the 3 class is sold at 78300 tenge per ton. Flour of the 1st grade in the capital is sold at 120,900 tenge per ton, extra grade – at 135,400 tenge per ton. The second grade of flour on the markets costs 106400 tenge per ton.

In Akmola region, a ton of grade 3 wheat is sold at 78,000 tenge, and wheat above 27% of gluten – for 83,000 tenge per ton, barley of grade 2 costs 52,200 tenge per ton. The highest grade of flour today is sold on 134500 tenge, flour of 1 and 2nd grades is offered on 120000 tenge and on 103500 tenge per ton respectively.

In North Kazakhstan region, grade 3 wheat is sold at 77,300 tenge, wheat above 27% gluten – for 84,300 tenge. Barley in SKO currently sells 52,200 tenge per ton. Flour of the highest grade of North Kazakhstan is sold at 132,500 tenge per ton, and the 1st grade – at 118,000 tenge per ton. Flour of the 2nd grade goes for 103500 tenge per ton.

In Kostanay region the price of grade 3 wheat reached 78600 tenge per ton, wheat above 27% gluten costs 83700 tenge. Barley 2 class Kostanai farmers offer 52,700 tenge per ton. Market value of flour of all varieties: the highest – at 133500 tenge, the 1st grade in the region is traded at 119,000 tenge. Flour of the 2nd grade in Kostanay region costs 10,4500 tenge per ton.

In Pavlodar region, a ton of grade 3 wheat is sold for 78,800 tenge, barley – 52,600 tenge per ton. Prices for flour in Pavlodar region were as follows: higher grade – 134,600 tenge per ton, 1 grade – 120100 tenge per ton, 2 grade – 105,600 tenge per ton.

In Karaganda region, a ton of grade 3 wheat costs 80,700 tenge, wheat above 27% gluten – 85000 tenge per ton. Barley – 52,500 tenge per ton. The highest grade of flour is traded at 135500 tenge per ton, flour of 1 and 2nd grades is sold at 121000 tenge and 106500 tenge per ton.

Wheat of class 3 in East Kazakhstan region sells 78,800 tenge per ton, barley – 53,600 tenge per ton. Flour of higher, 1st and 2nd varieties in East Kazakhstan is sold at 135,000, 120,500 and 107,000 tenge per ton respectively.

In West Kazakhstan region the price for wheat of class 3 – at the level of 79,400 tenge per ton. Flour of higher, 1st and 2nd grades in West Kazakhstan region is sold at 136700, 123200, 108700 tenge respectively.

Currently in Almaty region wheat of 3 class is offered at 80000 tenge per ton. Barley – 54300 tenge per ton. The highest grade of flour costs about 136200 tenge per ton, 1 grade – 121700 tenge per ton. Flour of the 2nd grade is sold at 107200 tenge per ton.

Wheat of class 3 in Zhambyl region today is sold at 79,600 tenge per ton, and barley of the second class – at 55,300 tenge per ton. Flour of the highest grade in the region is sold for 137,000 tenge, 1 grade is traded in the area of 122,500 tenge, 2 grade – 108,000 tenge per ton.

In Turkistan region wheat of class 3 is sold at 79,700 tenge per ton, and barley – 54,600 tenge per ton. The cost of flour of the highest, 1st and 2nd grades is currently fixed at 137100, 122600 and 108100 tenge per ton.

In Aktobe region, grade 3 wheat costs 81,900, flour of higher, 1st and 2nd varieties is sold at 138,000, 123,500 and 109,000 tenge per ton.

In Kyzylorda region, grade 3 wheat costs 81,400 tenge per ton. Flour of higher, 1st and 2nd grades is sold at 136700, 122200 and 108700 tenge per ton.

In the southern capital, Almaty, grade 3 wheat is sold at 81100 tenge per ton. The highest grade of flour in Almaty costs 137,600 tenge per ton, grade 1 and 2 leaves the markets at 123,100 and 107,600 tenge per ton, respectively.

Wheat of class 3 with gluten content of 23% under DAP conditions with Lugovaya (Kazakhstan-Kyrgyzstan) is sold (here and further dollars per ton) at $240-243, wheat with gluten 27-30% – 267-270, barley – 162-165, flour of the highest, 1st and 2nd grades costs 333-337, 298-303 dollars per ton,

Grade 3 wheat from South Ural Railway elevators is currently sold at $225-228, wheat above 27% gluten – $252-255, barley – for $147-150, flour of higher, 1st and 2nd varieties – at $317-322, $283-288 and $258-263, respectively.

On Sarah-Agash (Kazakhstan-Uzbekistan, DAP) 3 class wheat costs $244-247, wheat with gluten 27-30% – 271-274, barley – 166-169, flour of the highest, 1st and 2nd grades costs 336-341, 302-307, 277-282 dollars per ton.

At Tobol Station (DAP) Grade 3 wheat costs $234-237, wheat with gluten 27-30% – 261-264, barley – 156-159, flour of the highest, 1st and 2nd grades costs 326-331, 292-297, 267-272 dollars per ton.

At Hayraton (Uzbekistan-Afghanistan, CPT) the price for grade 3 wheat is $298-301, for wheat with gluten 27-30% – 325-328, barley – 220-223, flour of the highest, 1st and 2nd grades – 390-395, 356-360, 331-336 dollars per ton.

In the port of Aktau under FOB conditions wheat is sold at $254-257, with gluten above 27% – $281-284, barley – $176-179. Extra, first and second grade flour can be bought for $346-351, $312-317 and $287-292 per ton.

Alimbek Gabitov

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