Hungary is working on expanding the border checkpoints with Ukraine Chop-Zahony and Luzhanka-Beregshurani in order to equip corridors for the export of agricultural products bypassing Ukrainian seaports blocked by the Russian Federation.
This was announced by the Parliamentary State Secretary of Hungary Levente Madyar during a meeting with the head of the Transcarpathian Regional Council Volodymyr Chubirko, organized to address issues of current and future humanitarian support for Ukraine by Hungary.
For his part, the head of the Transcarpathian Regional Council promised, as far as possible, to assist in the implementation of all projects planned by Hungary for implementation in Ukraine, and presented the Hungarian official with world-famous stamps and a postcard on the theme of the Russian ship.
As reported, Ukraine, together with Hungary, intends to apply to the European Union to increase the throughput capacity of checkpoints on the Ukrainian-Hungarian border.
“We will apply together to the EU so that we can develop the capacity of transit corridors from both the Ukrainian and Hungarian sides. We are concerned about what the food supply of the world will be like as a result of the war … We are interested in the movement of goods to accelerate. This is not only the Hungarian , Ukrainian or European interest. This is a global interest,” Hungarian Agriculture Minister Ivstan Nadia said last week.
According to the Minister of Agrarian Policy of Ukraine Mykola Solsky, Slovakia and Hungary are logistics corridors in the European market that have not been developed, because Ukraine exported agricultural products mainly through the sea.
“We have fewer checkpoints on the border with Hungary than with Romania or Poland, so we plan to increase it and are already working on it,” the Ukrainian minister stressed.
President of Ukraine Volodymyr Zelensky noted “certain progress in the negotiations in Turkey on the restoration of food exports from Ukraine through the Black Sea.
“We are indeed making significant efforts to restore food supplies to the global market. I am grateful to the UN and Turkey for their respective efforts,” he said Wednesday evening in a traditional video message.
“The success of this story is needed not only by our state, but, without exaggeration, by the whole world. If the Russian threat to shipping in the Black Sea is removed, this will alleviate the severity of the global food crisis,” Zelensky said.
“The Ukrainian delegation reported to me that there is some progress. In the coming days, we will discuss the details with the UN Secretary General,” he said in conclusion.
JSC Ukrzaliznytsia exported 804,900 tonnes of grain cargo in June 2022, which is approximately the same as last month (807,000 tonnes), Deputy Director of the Department of Commercial Work at Ukrzaliznytsia Valeriy Tkachev said on Facebook during online meetings with industry representatives on Thursday.
In particular, 639,900 tonnes of grain were transported through land border crossings on the western border, and 165,000 tonnes were delivered to ports.
Tkachev specified that in June 2022, Ukrzaliznytsia loaded 1.23 million tonnes of grain into wagons, which is 14% of the total loaded volume of 8.57 million tonnes.
At the same time, the volume of transportation of grain cargo amounted to 1.36 million tonnes in June, which is 10.5% more than the volume of loading for this period.
According to Tkachev, the volume of average daily loading into wagons in June amounted to 38,000 tonnes. This figure tends to decrease on weekends: if on weekdays 50,000-70,000 tonnes are loaded into Ukrzaliznytsia wagons, then on weekends – an average of 26,000 tonnes.
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 World Bank may allocate $200 million to Ukrzaliznytsia (UZ) for the development of grain export capacity, Alexander Kamyshin, the head of the board of UZ, announced such a preliminary agreement. “We have tentatively agreed with the World Bank on $200 million in funding for our projects to develop grain export capacity,” he wrote in a telegram on Tuesday following the results of the Ukraine Recovery Conference in Lugano (Switzerland).
Earlier, on the sidelines of the conference, Kamyshin clarified to the Interfax-Ukraine agency that Ukrzaliznytsia failed to increase grain exports in June due to existing logistical restrictions.
As reported, Ukraine exported 1.41 million tons of grain crops in June 2022 compared to 1.2 million tons in May. At the same time, exports through the ports before the war of grain crops amounted to 4-5 million tons.
The price of wheat in Ukraine on EXW terms (self-delivery) has reached its minimum values for the month, having decreased by 31.1% over the period from May 23 to June 27 – to UAH 4,500/ton from UAH 5,900/ton, according to an infographic on the website of the consulting agency “Ukragroconsult” on Monday.
Over the same period, the cost of EXW corn decreased by 17.4% – to 4750 UAH/ton from 5750 UAH/ton, and barley – by 29.7% – to 4500 UAH/ton from 6400 UAH/ton.
At the same time, the main drop in prices for grain within the country occurred over the past week: for the period June 20-27, wheat fell in price by 24.4% (from 5600 UAH/ton on June 20), corn – by 15.1% (from 5600 UAH/ton ), barley – by 30.7% (from 6500 UAH / ton).
As reported with reference to the data of the electronic grain exchange GrainTrade, the purchase prices for wheat in Ukraine fell to 5500-6500 UAH / ton with delivery to the mill against the backdrop of blocking the country’s seaports by Russian warships. Additionally, the price reduction was influenced by the introduction of export licensing in March, the abolition of which in July 2022 was announced the day before by First Deputy Minister of Agrarian Policy Taras Vysotsky.
According to the exchange, in anticipation of the harvest of the new crop, agricultural producers are trying to free up granaries, so they are activating wheat sales, thereby increasing pressure on prices for it. Thus, the abolition of licenses will revive exports and stabilize wheat prices.
