USDA GAIN: Oilseeds, Cotton, Sugar, Grain and Feed
06 October 2012
USDA GAIN: Russia Oilseeds October Update 2012
FAS/Moscow forecasts production of Russia’s three major oilseeds (sunflowerseeds, soybeans and
rapeseed) in 2012 at 10.1 million metric tons (MMT), 2.4 MMT less than in the record year of 2011, but
still the second largest oilseeds crop in the last 20 years. This total includes 7.2 MMT of sunflowerseeds
(0.4 MMT less than in 2011), 2.0 MMT of soybeans (0.25 MMT more than in 2011), and 0.9 MMT of
rapeseeds (the same as in 2011). FAS/Moscow forecasts imports of oilseeds at 1.2 MMT, including 1.0
MMT of soybeans. Exports are forecast at 0.27 MMT, including 0.1 MMT of sunflowerseeds and
soybeans each, and 70,000 MT of rapeseed.
Production:
FAS/Moscow forecasts production of Russia’s three major oilseeds (sunflowerseeds, soybeans and
rapeseed) in 2012 at 10.1 million metric tons, 2.4 MMT less than in the record year of 2011, but still the
second highest oilseeds crop in the last 20 years. This total includes 7.2 MMT of sunflowerseeds (0.4
MMT less than in 2011), 2.0 MMT of soybeans (0.25 MMT more than in 2011), and 0.9 MMT of
rapeseeds, as in 2011.
The decrease in sunflowerseeds production is due to lower sunflowerseeds area, from 7.6 million
hectares in 2011 to 6.5 million hectares in 2012. As a result of a very dry summer, the sunflowerseed
harvest in the southern provinces of European Russia began in the first week of September, earlier than
in 2011. Rainfalls in the beginning of September slowed the harvest progress, but it was able to get back
on track with dry and warm weather in the second part of September. As of September 18, 2012,
Russian farmers harvested almost 1.9 MMT of sunflowerseeds from 1.0 million hectares, or 16 percent
of sunflowerseeds planned harvest area. The harvest began in the provinces with the highest yields:
farmers in the Southern Federal District harvested 0.45 MMT of sunflowerseeds from 26 percent of
planned harvest area in this district with the average yields of 2.3 MT/ha, and farmers in southern
provinces of the Central Federal District harvested 0.15 MMT of sunflowerseeds from 12 percent of
planned harvest area with the average yields of 1.85 MT/ha. As harvest moves to the northern provinces
of the Central Federal District and to the Volga Valley Federal District, yields are expected to decrease
and as a result Russia’s current average yield of 1.79 MT/ha as of September 18th, will also decrease.
In 2012 farmers increased area sown to winter rapeseeds, but unfavorable weather seriously damaged
this crop in the North Caucasus Federal District (Stavropol kray is the major producer of winter
rapeseeds). Separate data on winter and spring area and production will not be available before the
harvest is completed, but industry analysts report that spring rapeseeds area also increased compared to
last year. Despite higher area, yields of spring rapeseeds will be lower than last year due to dry
conditions in the Volga Valley, the Urals and Siberia (the major areas of spring rapeseeds). As of
September 18, 2012, Russian farmers harvested 0.7 MMT of rapeseeds from 0.6 million hectares, or 50
percent of area planned for harvest. So far the average yield is 1.17 MT/ha.
Russian farmers continue increasing area sown to soybeans. According to industry analysts, area sown
to soybeans in 2012 increased to 1.5 million hectares compared to 1.23 million hectares in 2011. There
is no official data on soybean area by provinces in 2012, but industry reports that the major increase in
soybean area is in the Russian Far East, which historically accounts for 65 percent of the total. The
head of Agrarian Committee of the Vladivostock Duma reported that in the last 3 years in Primorskiy
kray and Amur oblast of the Russian Far East soybean production has been growing by 20-30 percent
every year. In June 2012, V. Ishayev, Russian Minister for the Far East Development, reported that the
“soybean cluster” will be the basis for pushing all the economy of the Russian Far East upward. The
soybean harvest has not started in the Far East yet, and in the southern provinces of European Russia
(the Southern federal district, and southern provinces of the Central federal district) harvest began only
in the middle of September. As of September 18th Russian farmers harvested 275,000 MT of soybeans
from 170,000 hectares, or 11 percent of Russia’s total soybean harvest area. The yields are 1.63 MT/ha.
In the last 3 years Russian farmers increased production of other oilseeds, especially flaxseed, and this
tendency continued through 2012. However, there is no official data on the sown area or harvest progress of these oilseeds.
Consumption:
FAS/Moscow forecasts Russia’s total crush of major oilseeds in MY 2012 at 10.47 MMT, including 6.7
MMT of sunflowerseeds, 2.9 MMT of soybeans, and 0.87 MMT of rapeseeds. Compared to last year
this is a 1.5 MMT decrease, and is due to lower production and crush of sunflowerseeds. The crush of
soybeans is forecasted to rise from 2.4 MMT to 2.9 MMT, and is being driven by increased capacity and
continued strong demand from the domestic poultry and livestock sectors.
Trade:
From September 2011 through August 2012 Russia imported 26,000 MT of sunflowerseeds. Exports of
sunflowerseeds in MY 2011 were 331,500 MT, the largest since 2006. Russia committed as part of its
WTO accession to decrease export duties on sunflowerseeds from 20 percent (but not less than 30 Euro
per MT), to 6.5 percent (but not less than 11.4 Euro per MT) with a 3 year implementation period. This
measure is expected to support exports of sunflowerseeds in the longer term. However, in MY 2012 the
combination of a smaller crop and strong demand from Russian crushers is expected to result in smaller
exports compared to last year. FAS/Moscow forecasts sunflowerseeds exports in MY 2012 at 100,000
MT, while imports of sunflowerseeds (mostly from Ukraine) may increase to 100,000 MT.
In September 2011 – August 2012 Russia imported 740,741 MT of soybeans (including 30,250 MT
from the United States). The major suppliers were Paraguay (513,540 MT) and Brazil (149,534 MT).
Exports of soybeans in September 2011 – August 2012 were reported at a historic record of 70,425 MT
(44,240 MT was exported to China; the rest was exported to Turkey and Iran). This export volume was
a sharp rise from 720 MT in MY 2010. The Russian Government decreased the soybean export duty
from 20 percent (but not less than 35 Euro per MT) to only 5 percent (but not less than 8.5 Euro per
MT) for the period of June through September 2012 (Government Resolution #408 of May 2, 2012). In
accordance with WTO commitments, Russia’s soybean export duty will completely disappear within 3
years following the WTO accession date of August 22, 2012. For MY 2012, soybean exports are
forecast to rise to 100,000 MT as a result of larger production in the Far East. Despite higher domestic
production, with very strong demand and increasing crushing capacity, imports are expected to increase
to 1.0 MMT.
For rapeseeds, from July 2011 through June 2012 Russia exported 53,892 MT of rapeseeds (almost all
to the EU). FAS Moscow forecasts rapeseeds exports in MY 2012 at 70,000 MT.
Flaxseed (for oil) was the largest oilseed export from Russia in MY 2011. In July 2011 - June 2012
Russia exported 360,918 MT of flaxseeds (for oil). The major importers of the Russian flaxseeds were
United Arab Emirates, China, Belgium, Afghanistan, and Turkey. In the first two months of MY 2012
(July – August) Russia exported 52,430 MT of flaxseeds to Turkey and Italy. Industry analysts forecast
growing foreign demand in flaxseeds, and exports will grow and continue to stimulate increased
domestic production.
Policy:
The Russian government has undertaken the following measures to stimulate production and transportation of soybeans:
- Government Resolution #408 that temporarily decreased export duties on soybeans
- On June 19, 2012 the Federal Service on Tariffs (FST) extended the preferential tariff on shipment of
soybeans and soybean cake/meal to the end of 2012. The preferential tariff is a 0.5 coefficient to the
normal tariff for shipments of soybean and products to distances over 1,100 km. Besides, the FST
allowed using this preferential tariff for light (empty) running of (own or rented) railway cars if they are
to be loaded with grain/soybeans and products for the further transportation on the terms of preferential
tariffs.
However, industry analysts consider that these measures will have only small effect on Russia’s
domestic soybean production and trade. The major stimuli for increased soybean production are
increased domestic demand in protein feeds, especially soybean meal, and increasing prices of these
protein products.
Marketing:
Domestic prices of sunflowerseeds, Russia’s major oilseed crop have started rising since late spring
2012 when it became clear that sown area will be down. The rise in sunflowerseed prices accelerated in
September, following, albeit at a slower pace, the increase in prices of grain crops.
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