While feedstuff prices remain at an extremely low level on the Ukrainian market, feed additives prices jumped in the background of sharp currency devaluation and logistics problems, the Ukraine Agribusiness Club (UCAB) told All About Feed.
Ukraine’s central bank devalued the hryvnia currency by 25% against the US dollar in July to help the country cope with the growing economic impact of the war with Russia. It set the official hryvnia rate at 36.56 per dollar compared with 29.25, where it had been frozen for the past 5 months.
The grain export deal has yet to bring a balance to the Ukrainian grain market where a large surplus is still seen. Max Gopka, a UCAB analyst, said feedstuff prices remained way lower compared with the previous year.
Meanwhile, the price of almost all feed additives increased in Ukraine.
“The reason for such a rapid growth is the change in logistics routes, the cost of currencies, the devaluation of the hryvnia, the rise of logistics costs and the risks of importing foreign products to Ukraine as a result of hostilities,” Gopka said.
Ukraine used to import feed additives through seaports in containers, but this is no longer an option.
“While Ukrainian ports are closed, Chinese amino acid suppliers have to go to the ports of Romania, Poland or Turkey where they switch to land logistics, and this, in turn, takes more time and incurs additional financial costs,” Gopka said.
Gopka added that some feed additives, in the first place feed vitamins, were imported from the European market and were always transported by land.
“Although there were no supply chain disruptions in this field, container logistics increased in price by 2-2.5 times, which also affects the final price of feed [on the Ukrainian market],” Gopka said.