Process Management

News last update:6 Aug 2012

Ukraine's grain export potential drops sharply

The export potential of Ukraine's grain market is falling day by day, with 2012/2013 cereal exports expected to fall by almost 5 million tonnes compared to the previous season. According to the representatives of the Association of Ukrainian Agribusiness Club (AUAC) this fall is due to lower harvest of early crops.

In addition, experts have concerns about the further decline in exports due to record high losses for farmers. Some may have to make the decision between sowing winter crops or paying rent.
According to the AUAC experts, 2012/13 corn exports will be 15.5 million tonnes compared to 15.3 million tonnes the previous season (taking into account the fact that the marketing year for corn runs until September). Wheat exports will decrease from 5.25 million tonnes to 2.3 million tones, barley - from 2.5 million tonnes to 500,000 tonnes. The overall rate of grain exports may decline to 18.6 million tonnes, a 4.6 million tonnes drop (or 20%) than the previous season.
AUAC experts also noted that with the expected decrease of grain yield in 2012 compared with the previous year, a decrease of export shipments will not be as significant because of large carry-overs.
"Export potential of the agricultural sector falls with each passing day due to worsening weather. But we also have serious concerns about our 2013 harvest because of drought and the fact that the value of land has nearly doubled this financial year. Losses for farmers is expected to hit a record high – about 10 billion of hrivnias (US$ 1.2 mln). Many of them will have to choose between sowing winter crops or making payments for rent, "- said General Director of Association Vladimir Lapa.

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