Russian grain imports are likely to soar after the country's worst drought in more than a century damaged its harvest and forced it to ban exports, analysts said on Thursday.
Analysts estimate that Russia, usually a major grain exporter, may have to import 1.5-2.2 million tonnes this year after the worst drought in more than a century damaged its harvest, but a report in Vedomosti daily said Russia could import at least 5 million tonnes of grain this year.
European milling wheat futures rose sharply in opening trade on Thursday, lifted by prospects that Russia will have to resort to hefty imports.
We currently estimate domestic seasonal grain imports at 2.2 million tonnes as a minimal figure, Dmitry Rylko, director of the Institute for Agricultural Market Studies (IKAR) told Reuters.
He expected most of the imports to come from Kazakhstan and Ukraine, which is also considering curbing exports after its grain crops were hit by severe frosts and a scorching summer.
Russia, which was a major grain exporter last year, imported 94,600 tonnes of wheat, 30,700 tonnes of barley and 38,000 tonnes of maize in the 2009 calendar year, according to customs data. Kazakhstan and Ukraine were the main suppliers.
Andrei Sizov Sr., CEO of SovEcon agricultural analysts, told Reuters Russian grain imports may rise to some 1.5 million tonnes from around 400,000 tonnes this year.
Kazakhstan's agriculture ministry said on Thursday it plans to export 8 million tonnes of grain in the current marketing year, of which 2 million tonnes would go to Russia, Iran and other countries.
Russia's deadly heatwave is estimated to have destroyed a quarter of its grain crop and could shave $14 billion off this year's gross domestic product. It has banned grain exports from Aug 15 until Dec. 31 to curb rising prices.
Russia's total grain crop is officially expected to reach 60-65 million tonnes, although some analysts believe it may fall below 60 million tonnes. The 2009 harvest was 97 million tonnes. (Additional reporting by Alfred Kueppers; editing by Sue Thomas)