* Russia may need to import 6 million tonnes of grain -
analyst

(updates with price reaction)

By Nigel Hunt

LONDON, Aug 26 (Reuters) - Severe drought in the Black Sea
region threw the global wheat market into a bigger deficit on
Thursday, while a leading analyst increased its estimate for
Russia's import needs, driving wheat prices higher.

The London-based International Grains Council lowered its
2010/11 wheat crop forecasts for Russia, Kazakhstan and Ukraine,
leading to a drawdown in global stocks with demand continuing to
rise. The global wheat crop was sliced 7 million tonnes to 644
million tonnes.

While the IGC still saw Russia as a net exporter of grain
after its worst drought in more than a century, leading
agricultural analyst SovEcon had other ideas.

It said last year's third largest global wheat exporter may
need now need to import up to six million tonnes of grain in the
current crop year.

Wheat prices rose on Thursday on the Chicago Board of Trade
after the report was issued with the September contract gaining
more than two percent to $6.63 a bushel by 1700 GMT.

The IGC saw Russia's wheat crop at just 44 million tonnes,
down from a previous forecast of 50 million and sharply below
the prior season's 61.7 million.

Kazakhstan's wheat crop was also cut to 12.0 million tonnes
from 13.5 million seen a month earlier and Ukraine's to 17.5
million from a previously anticipated 18.5 million.

"Adverse weather conditions continued to affect yield
prospects in parts of the EU, Kazakhstan, Russia, Ukraine and
Australia," the IGC said in a monthly market report.

The drop in production in the Black Sea, a key region for
wheat exports, opened the door for the U.S. whose exports are
now seen reaching 33.0 million tonnes from 28.5 million seen a
month ago and the highest level since the 2007/08 season.

"The sharp fall in Black Sea region exports will see a
marked shift in trade flows, with U.S. exports in particular
placed much higher than before," the IGC said.

The U.S. Department of Agriculture said U.S. wheat export
sales last week totalled 1,077,600 tonnes, above an average of
analysts' estimates for 750,000-900,000 tonnes.

RISING DEMAND

Demand for wheat is also increasing despite a rise in prices
which earlier this month spiralled up to the highest levels in
two years before settling back.

The IGC raised its wheat consumption forecast for 2010/11 to
657 million tonnes, up from a previous projection of 655 million
and 648 million in 2009/10.

The increase is driven by demand in Russia where the
production of other crops such as barley which are used to feed
the country's expanding livestock numbers has fallen sharply.

"Although recent high prices have reduced feed use of wheat
in parts of Asia and the EU, this is more than outweighed by an
increased forecast for Russia," the IGC said.

Russia halted exports from Aug.15 until the end of 2010 and
while Ukraine this week put off introducing curbs on exports,
shipments have been slowed by new quality checks.

Ukraine's Customs Service said on Thursday it would keep up
quality checks on all Ukrainian wheat export shipments and might
extend them to other cereals.

The deputy head of Ukraine's customs service, Serhiy Semka,
told Reuters the checks were "normal procedure" and the drop in
export levels was not caused by customs curbs.

"We do not want to give a negative image to traders. What we
are doing is not directed at creating any artificial bans or
limits for wheat exports", Semka said.

The IGC also cut its forecast for wheat stocks at the end of
the 2010/11 season by 8 million tonnes to 184 million, now down
13 million tonnes from a year earlier.

Wheat stocks would still be at "a comfortable level," far
above the 110 million tonnes held at the end of the 2007/08
season, the IGC noted, adding that the lower global wheat crop
would still be the third highest on record.
(Additional reporting by Sarah McFarlane in London, Aleksandras
Budrys in Moscow and Pavel Polityuk in Kiev; editing by Keiron
Henderson)