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Country Briefs

  Ukraine

Reference Date: 02-October-2017

FOOD SECURITY SNAPSHOT

  1. Cereal production in 2017 estimated at above average level

  2. Grain exports in 2017/18 marketing year forecast slightly below previous year’s record

  3. Export and domestic prices of wheat declined in September

Cereal production in 2017 estimated at above average level

Harvesting of the 2017 cereal crops, with the exception of maize, is almost completed. Despite unfavourable weather conditions during the planting of winter and spring cereals, aggregate output is estimated at 63.5 million tonnes, well above the five-year average. Wheat output is expected at 26 million tonnes, marginally above the high level of the previous year and similar to the record of 2015. The quality of the crop is reported to be good and the share of milling wheat is estimated at 50 percent.

Harvesting of maize will be finalized by the end of November and production is expected at 27 million tonnes, well above the average and just 3 percent below the record of 2016.

By contrast, barley production is estimated to decline by 11 percent from the good level of 2016 to 8.4 million tonnes. This decline is mainly on account of a 13 percent reduction in the area planted due to less competitive prices which induced farmers to opt for other crops.

Planting of the 2018 winter cereals started at the end of August. By end-September, 2.4 million hectares were planted under wheat (39 percent of planned), 60 000 hectares under barley (6 percent) and 73 000 hectares under rye (46 percent). For the third consecutive year, winter cereals are planted under dry weather conditions.

Cereal exports in 2017/18 forecast slightly below the previous year’s record

Total cereal exports in the 2017/18 marketing year (July/June) are forecast at about 42 million tonnes, 5 percent below the previous year’s record level. Most of the decline is on account of the expected reductions in shipments of wheat following the increased competition with the Russian Federation, which has gathered a record wheat crop production in 2017. Moreover, Egypt, the country’s largest wheat buyer, imposed new requirements for imported wheat, raising the protein content from 11.5 to 12.5 percent for wheat bought from the Black Sea region. This measure is expected to favour the Russian Federation, where wheat has higher protein content compare to Ukraine. Therefore, wheat exports from Ukraine are set at 16.5 million tonnes, down 6 percent from the high level of 2016/17.

Barley exports are also expected to decline by 12 percent to 4.7 million tonnes, due to a smaller domestic crop in 2017.

By contrast, maize shipments are forecast at 20.2 million tonnes in the 2017/18 marketing year, close to the record level of the previous year. The high level of exports together with the decline in domestic production are expected to withdraw the country’s maize stocks to the lowest level since 2012/13.

Export and domestic prices of wheat declined in September

Export prices of wheat started to decline since mid-August, pressure by the availability of newly-harvested crops. However, the declining trend was hampered at the end of September as prices received support from an increase in demand by traditional importers.

Domestic prices of wheat declined since the end of August reflecting the start of the harvest, but the decreases were limited as a result of upward pressure from a weakening currency. In September, domestic prices of wheat were around 17 percent higher than their values of a year earlier and almost 50 percent higher than two years ago.

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