The Bloomberg Commodity Spot commodity price index has already fallen by 20% since it reached a historical record a month ago.
The calculation of the indicator includes 23 futures contracts for energy carriers, metals and agricultural crops.
Despite ongoing supply disruptions, prices for everything from gasoline to wheat are falling on concerns that a stagnating global economy will weigh on demand. This may provide some help in the fight against high inflation in many countries, Bloomberg notes.
Fears are growing in the US that the Federal Reserve will not be able to tame the highest inflation in four decades without plunging the economy into recession. The sharp rise in the US dollar, which makes buying raw materials more expensive for representatives of other countries, also affected commodities traded in the United States. Hedge fund bets that commodities will rise in price have fallen to their lowest level in almost two years.
However, a recession is a “highly anticipated issue” and markets have “clearly overreacted” by bringing commodity prices back to pre-war levels in Ukraine, said portfolio manager Pacific Investment Management Co. Greg Sharenow. Supplies of commodities such as oil remain limited and vulnerable to disruption, he said. The expert expects a resumption of demand in the coming months against the backdrop of China’s economic recovery.
The Ukrainian Grain Association (UGA) increased the forecast for the harvest of grain and oilseeds in Ukraine in 2022 by 4.4% compared to the May forecast – up to 69.4 million tons from 66.5 million tons, according to the UGA website on Wednesday.
At the same time, the assessment by the association of sown areas under these crops increased by 1.6% compared to forecasts in May – up to 19.1 million hectares from 18.8 million hectares.
“Ukrainian farmers, despite the difficult wartime conditions, minefields and hostilities due to the aggressive war of the Russian Federation, continue to courageously fight for the harvest so that Ukraine has enough grain and can export part of the crop to the world market. This year, Ukraine can get 69 .4 million tons of grain and oilseeds from an area of about 19.1 million hectares,” the UGA said in a statement.
At the same time, the export of grain and oilseeds from Ukraine in the 2022/2023 marketing year (MY, July-June) can reach 31.5 million tons, subject to a significant increase in the throughput capacity of border crossings on the western borders of Ukraine. Given the current throughput capacity, Ukraine can count on the export of about 25-30 million tons of crops in the 2022/2023 marketing year that has begun.
According to the results of 2021/2022 MY, it is expected that the transitional crop balances in the country will amount to about 25.9 million tons (+0.9 million tons compared to UGA forecasts in May). In 2022/2023 MY, this figure may increase to 36.6-48 million tons due to the inability to export agricultural products at the usual pace for Ukraine. In May, the association predicted transitional balances for 2022/2023 MY at the level of 31-43 million tons.
According to UGA forecasts, in 2022, a wheat harvest is expected at the level of 20.8 million tons (+8.3% compared to the organization’s May forecast); 27.3 million tons of corn (+4.6%); 6.6 million tons of barley (forecast kept); 9 million tons of sunflower (forecast kept); 2.2 million tons of soybeans (+4.7%); 1.5 million tons of rapeseed (+13.3%).
UGA also predicts the export of wheat in 2022/2023 MY at the level of 10 million tons, corn – 10 million tons, barley – 2 million tons, sunflower – 6 million tons, soybeans – 1.8 million tons, rapeseed – 1.45 million tons.
“In general, the export of grains and oilseeds in 2022/2023 MY can be expected at the indicated level, if Ukraine, under the blockade of the Black Sea ports, can double the throughput of other logistics directions, including railway crossings at the borders with the EU countries,” the association explained in message.
At the same time, the unblocking of the Black Sea ports will greatly simplify the logistics and cost of transporting grain for export, and producers will be able to make a big profit for the grown crop in accordance with the high prices for agricultural crops that are currently prevailing on the world market. “Unblocking Ukrainian ports and ensuring the safety of navigation in the Black Sea is the only way to quickly and effectively resume Ukrainian grain exports to countries in dire need. The lack and high cost of food can cause, according to UN estimates, famine in many poor countries of the world, mass protests and riots, and as a result mass migration of people from Africa and the Middle East to the EU,” the UGA summed up in the message.
As reported with reference to the data of the State Statistics Service, in 2021 Ukraine harvested a record harvest of grain and leguminous crops in the amount of 85.7 million tons, which is 32% more than in 2020. In total, 32.07 million tons of wheat (+28.9%), 41.87 million tons of corn (+38.2%) and 9.42 million tons of barley (+23.3%) were harvested.
Ukraine in 2021 also harvested 16.38 million tons of sunflower (+25% compared to 2020), 10.8 million tons of sugar beet (+18.1%), 3.5 million tons of soybeans (+24.4%), 2.92 million tons of rapeseed and 42 thousand tons of oilseed flax (an increase of 3.7 times).
The Ukrainian Grain Association (UGA) is an association of producers, processors and large grain exporters who annually export about 90% of Ukrainian grain products.
The port of Constanta (Romania) has begun using a floating crane to reload crops arriving along the Danube River on barges from Ukraine onto commercial ships for further shipment to third countries.
This will eliminate the need to reload grain to port granaries from the logistics chain and will increase the cargo flow processed by the port, according to the website of the Bulgarian publication Maritime.bg.
“Transport Trade Services (TTS) has launched a new comprehensive logistics project that provides a significant increase in cargo traffic from Ukraine, transported from the river ports of Reni and Izmail, and their subsequent loading onto commercial sea vessels in the port of Constanta,” the publication’s website states.
According to him, Ukrainian grain cargoes will be reloaded by a floating crane in the deep-water part of the port of Constanta directly from barges arriving by river transport to commercial vessels.
According to the publication, the first ship loaded according to the new logistics model was the Lausanne motor ship (the flag of Sierra Leone), which received 31,000 tons of grain from Ukraine.
As reported, due to the congestion of logistics routes in the Sulina Canal (Romania), Ukrainian exporters of agricultural products are forced to wait in line for loading grain carriers for 10 days or more, which in total causes them $500,000 in losses per day.
Ukrainian Minister of Agropolitics Mykola Solsky said that the logistics of Ukrainian agricultural products through Romania could become more complicated and slow down in June, when a new crop of Romanian, Serbian, Hungarian and Bulgarian winter wheat and barley will begin to arrive at the seaports of this country and will create competition for supplies from Ukraine.
The Tekhkomplekt special equipment plant, which has production facilities in the Kyiv and Poltava regions, has begun production of grain trucks with a large load under the AGRiLine marking, the company reports on its website.
“The first model of a grain carrier, called MEGA Koshmanivets, was released in partnership with our dealer, Eridon Tech, and the entire line of grain carriers will be produced under the AGRiLine label and will be mounted on truck chassis, semi-trailers and trailers,” the message says.
The body of the grain truck MEGA Koshmanivets has unloading back and on the right side, the volume of loading with agricultural crops is designed for 35 cubic meters. m.
A Chinese truck with a gross weight of 33.5 tons and a permissible load capacity of 24.5 tons is used as the base chassis, but, as noted in the message, a grain carrier with such a body volume and based on any other chassis with a gross weight of 32 tons or more is recommended to load up to 20 tons.
Among the advantages of the grain truck body, Tekhkomplekt notes the use of Strenx 700 high-strength steel for the manufacture of load-bearing elements of the platform and sides, Hyva hydraulics, imported factory fittings for tipping the body, and other structural advantages.
The production of AGRiLine grain carriers has passed the necessary tests and is certified by Ukrainian notification authorities.
The plant is currently forming a portfolio of orders for 2023.
Plant “Tekhkomplekt” is an enterprise with a full cycle of production of special equipment and superstructures on the chassis of cars of various brands. The resources of the enterprise allow to repair and re-equip up to 100 trucks and commercial vehicles monthly. For 24 years of operation, the plant has shipped more than 35 thousand units to customers. special equipment.
Earlier it was reported that in connection with the abandonment of the Belarusian (MAZ) and Russian (GAZ) manufacturers, which were previously actively used as new base chassis, Tekhkomplekt is expanding their model range, including through Asian manufacturers.
Tens of thousands of migrants will be able to legally stay in Germany after the country passed a law that makes it easier for them to obtain documents for permanent residence, the Associated Press (AP) reported on Wednesday.
“We want people who have already settled here to have good opportunities,” German Interior Minister Nancy Feather was quoted as saying by the AP.
“Also through this law, we will put an end to bureaucracy and uncertainty for people who have become part of society,” she added.
The new measure will affect around 136,000 people who have lived in Germany for at least five years.
At the same time, these people must have a decent salary, speak German and prove that they have integrated well into society.
Those who meet the necessary requirements can first apply for a residence status in Germany for a period of one year, and then for a permanent residence permit in the country.
People under 27 can apply for permanent residence after they have lived in the country for at least three years.
Information technology specialists, as well as some other specialists that Germany needs, will have the opportunity to move with their families, which was not possible before. In addition, the law will make it easier to enroll in German language courses for refugees, as well as facilitate the deportation of criminals.
PJSC Centravis Production Ukraine (Centravis Production Ukraine), which is part of the Centravis Ltd. holding, after quality approval, supplied stainless steel pipes of the German companies Buhlmann and Bilfinger, intended for use in the nuclear industry.
According to a press release from the company on Wednesday, the pipe acceptance procedure was carried out in Germany.
It is noted that the Buhlmann group of companies is a premium company selling steel pipes, pipe fittings and accessories worldwide, and Bilfinger is a European company specializing in civil and industrial construction, design, services, located in Germany.
“Final inspection of the last lines of the Hinkley Point C BOP order has been completed. Hinkley Point C is a 3200 MW nuclear power plant consisting of two units, the plant is under construction in Somerset, England. The Hinkley Point C nuclear power plant is of great importance for the UK in terms of reducing emissions carbon.”, – stated in a press release.
In addition, it is specified that the electricity produced by the two EPR reactors will prevent the emission of carbon dioxide at the level of 9 million tons annually. Mechanical properties, metal structure and resistance to intergranular corrosion fully meet the requirements used in the nuclear industry. The auditors also had no comments on the document flow and its quality.
“You managed to complete all the remaining work and provide us with full support in the export of products from Ukraine. We greatly appreciate the stable and reliable communication with you and your team over the past few weeks,” said Jan Paul Godhoff, director of international projects at Buhlmann.
In turn, Centravis Sales Director Artem Atanasov stressed that Ukraine is now going through difficult times, and participation in major global projects is the company’s support from European colleagues.
“Centravis” is one of the world’s largest manufacturers of seamless stainless steel pipes, founded in 2000. Its production facilities are located in Nikopol (Dnepropetrovsk region). Included in the top 10 global players, supplies pipes to more than 70 countries from different regions, in particular to Thyssenkrupp, Buhlmann, BMW, Alstom, Linde, Samsung, Volkswagen.
Before the Russian aggression, more than 1,400 people worked at the enterprise.
Holding Centravis Ltd. was created on the basis of CJSC “Nikopol Stainless Pipe Plant”, service and trading companies LLC “Production and Commercial Enterprise “UVIS”. Its shareholders are members of the Atanasov family.
Owned by Centravis Ltd. 100% of the shares of PJSC “Centravis Production Ukraine” is located.
