Russia’s southern wheat region in need of rain

Harvest could fall 20 percent short of expectations if weather does not improve

Russia’s Rostov region, a major wheat producer, risks falling 20 percent short of harvest expectations if it does not receive enough rain in the coming weeks, according to a report.

“The weather conditions have been difficult for us since last autumn, seriously lacking moisture,” said Roman Bondarev of RZ Agro Holding. “Then starting in April the rains came and boosted the soil humidity. That allowed the wheat to develop and get the momentum you see now.”

In May, temperatures in the region reached more than 90F.

Rostov, along with Krasnodar and Volgograd, are among the country’s most important wheat-producing regions. Wheat from these regions are primarily exported to North Africa and the Middle East through the Black Sea.

Russia recently decided to lift its wheat export duty almost a month and a half ahead of schedule.

The tax of EUR35 (US$40) per ton originally was imposed from February 1 until June 30 to cool domestic prices and food inflation after the ruble fell last year. But Russia’s wheat prices have been falling as inflation has slowed and supplies have remained high.

The decision to lift the tax will allow Russia to export up to one million tons more of wheat by June 30, which will help avoid a grain glut domestically and keep prices above the cost of production, according to reports.