26 week: Russian River, Azov / Black Sea, Caspian; Coaster shipments
A large hail in the north of the Krasnodar Krai and a drought in Crimea and the Stavropol Krai had taken a tall on the winter grain forecast. Local agrarians have already announced an incomplete harvest about 20% compared to the planned volumes.
At the same time, it is too early to talk about reduction of yields, as the main harvest has yet to be reaped. Also according to information of Traders and corn producers, a low corn crop is expected this year, owing to the hot weather caught the culture in the fledging period. Now Agrarians hold the corn stocks. At the height of the season when the demand for corn will increase, there will be an opportunity for producers to sell the goods at more favorable price.
There is an increase in demand for shipments with wheat and barley from the Azov region on week 26, the Charterers has been forming lots of the new harvest. Over the past week, rates from the Azov basin increased by 3-4 dollars in all directions. Thus, workable freight level for voyage ex Rostov to Marmara reached USD 23 pmt on week 26. Ship Owners prefer to work closer to the spot dates, as they are confident of the further upturn in demand for tonnage. However, the Charterers suggest that rates will grow slowly, and the level USD 23 – 25 will be kept over a period of several weeks.
Due to the volatile economic environment and political situation in Turkey the Importers are still didn’t show any business activity. If last year, by the time of harvesting, Russian Traders had already actively worked with the Turkish partners, then this year the Turkish side is interested in grain market in Russia rarely. Market participants say that this situation can continue for a very long time, until Republic can meet the demand for grain in the domestic market.
In late June – early July a large number of Owners of the Russian-flagged tonnage moved for lighterage work on the Kavkaz port. After being informed that according to new rules the quotas for grain transshipment in the Novorossiysk port are apportioned only between major Traders, the interest in this market segment was rekindled. Another part of Charterers, in order to continue their activities, switched their attention to the road of the Kavkaz port, therefore it is so popular. Nowadays there is an increase in freight rates in this direction: the cargo supply has come up, for realize of the transshipment program is required more vessels. As described in website of the Kavkaz port, the volumes of grain transshipment grow every month.
In the Caspian region, unlike Azov, the freight market didn’t change over the past period. The freight basis of the Astrakhan – Iran kept the level of two last week and amounted USD 31 pmt.