Russia cashing in on world barley slump

Smaller barley harvests from Europe to Australia are helping Russia offload its bumper crop faster than anywhere else.

Russian exports of the grain used mostly for animal feed surged 60 percent so far this season, government data show. For the whole of 2017-18, the country’s sales will jump more than any other major shipper, while global exports fall to a four-year low, according to the U.S. Department of Agriculture.

World output is falling, partly because dry weather hurt crops in Australia and a heat wave was followed by heavy rains in parts of the European Union, the top two exporters. With the market heading for a second-consecutive shortfall, global inventories will shrink to their lowest level in more than three decades. That’s giving top producer Russia a chance to grab more of the export market after its crops benefited from ample rains.

“Russia has been the only barley exporting country that was able to significantly increase its production in 2017,” said Stefan Vogel, head of agricultural commodities research at Rabobank International in London. “Thus, exports are flowing at a much stronger pace.”

While global output will decline 4 percent to 156.5 million tons this season, Russia’s harvest will increase 17 percent to a nine-year high of 22.6 million tons, USDA data show.

— Bloomberg News