GENERICO.ruEconomicsMay frosts in Russia “warmed up” the Chicago Grain Exchange

May frosts in Russia “warmed up” the Chicago Grain Exchange

Planting of fruit and berry crops suffered by 70-90%

Due to May frosts in the central and southern regions of Russia, grain futures quotes on the Chicago Stock Exchange rose to their highest level since August 2023 . Up to 6.6 dollars per bushel, that is, per 30 kilograms.

The situation with wheat in the world is on the verge of panic. After all, Russia is the main exporter of bread, and its crops were severely damaged as a result of bad weather.

However, other agricultural crops – fruit and berries – were also damaged.

Can we correct the situation, MK found out from experts.

Planting of fruit and berry crops suffered 70-90%

In three regions of Russia – Voronezh, Lipetsk and Tambov regions – a state of emergency has already been declared. Farmers from the Kuban, Volga and North Caucasus federal districts are also counting their losses.

The Ministry of Agriculture says that domestic farmers will be able to replant some of the damaged areas. But then you will end up with double costs for the sowing campaign. Both the price of seeds and the cost of diesel fuel – we multiply everything by two. When growing grains per 1 hectare, fuel consumption using traditional technology is approximately 80 liters.

At what price will peasants sell their crops in the fall? It’s better not to think about it.

As Igor Abakumov, candidate of economic sciences and presenter of the “Rural Hour” program, says, grain prices have already begun to creep up. But not for the current harvest, which is still a big question, but for… last year's. Russia has millions of tons of wheat from last year and even the year before. And those who were in no hurry to sell it are now not shy about pricing. “This is their little revenge on the Ministry of Agriculture for low purchasing prices in the season.”

– It has not yet been calculated, we can talk about this after May 20th. But according to the most preliminary estimates – 1 million or a little more. This year, the total cultivated area in the country is 85 million hectares, losses are less than one percent, this is not critical.

– There is still time. And the growing season of many crops allows this to be done. But the question is the performance of sowing units and tractors. They are just finishing the sowing season and now they have to go out into the field again. Experience shows that equipment needs repair. There's a problem with spare parts. Both the price and delivery logistics are high.

Add here additional fuel costs. Diesel fuel will automatically begin to rise in price; the government needs to take emergency measures to stabilize the fuel market.

– Sugar beets, wheat, barley, soybeans… It’s not yet clear about potatoes; the “second bread” has not yet sprung up. There are domestic seeds of some crops, but we don’t know exactly how many yet. The Ministry of Agriculture begins an audit of the seed fund. And this year strict quotas have been established for the use of imported seeds; according to the regulator’s plan, we must switch to domestic planting material.

– I think about two weeks. We will learn about domestic seed reserves after this event.

While Russian field growers still have the opportunity to partially reseed areas, fruit trees and berry bushes cannot be reseeded or replanted in the spring. And here the elements cleared up as they should. According to the general director of the Berry Union, Irina Koziy, there were streaks of frost in those regions where these crops mainly grow: Lipetsk, Tambov, Voronezh, Penza, Tatarstan and Bashkiria.

“Somewhere the temperature dropped to minus 8 degrees,” she says. – Farmers reported that bumblebees even froze on the flowers. Where the temperature did not drop so sharply, it was possible to save the plants; they created a smoke layer that did not allow cold air to descend to the flowers.

– From pome trees – apple trees, from stone fruit cherries and plums. Berries: black currant. This is where the biggest losses are. The flowering season of black currant is very short, which is why frosts occurred. Siberian varieties of honeysuckle were also severely damaged, right up to the Ivanovo region.

– We can say that prices would have risen in any case, even if there had not been such a cold spell. The cost of production has increased significantly this season: logistics, planting material, means of gartering plants, packaging.

The frosts that have occurred, for their part, will also add to the rise in prices.

There are fruit and berry farms , which will lose 70 to 90 percent of their harvest. They need a special financial support program. If it doesn’t exist, then many enterprises will simply leave this business. We will be short of production not only this year, but also for many years to come. They will leave, and for now there will be no one to take their place…


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