The market is starting to react to the serious deterioration of the prospects of the new crop in Russia. Last week, "SovEcon", the USDA and a number of Russian experts have seriously reduced their estimates. Sovekon by 7% to 76,6 million tonnes (including the Crimea, assessment of the production of 0.95 million tons), USDA – 5% to 74.2 million tonnes (excluding the Crimea). The forecast of the Ministry of agriculture in 75 million tons in the current environment, began to look quite true. This week, SovEcon expects to release an updated production forecast.

We will remind, on July 17, the Egyptian state company GASC has purchased a shipment of wheat from Russia. On the tender Egyptians bought 60 thousand tons of Russian wheat at a price of 215,6 USD per ton C&F ($201,4 FOB + freight of $14.2). The choice in favor of Russian wheat were made only because of the cheap freight; and other freight offers were above $18 per ton. Most of the proposals were for a few dollars higher than at the previous tender.

What does it mean? Probably, slow procurement of GASC and other importers indicate the hope for lower prices for wheat from the black sea region, - said analysts of "Sovekon". Customers still expect high yields in the region. However, these expectations may not be justified.