According to the results of the spring sowing season 2023 in Ukraine, farmers increased the areas under grain crops, particularly corn, and reduced the areas under oilseeds, particularly sunflower, and will get 61.4 million tons of gross crop of these crops, according to the website of the Ukrainian Club of Agrarian Business (UCAB) on Tuesday.
It is specified that such changes are fixed compared to the previous UCAB forecast, but not to the previous year. The forecast also raised yield expectations for winter crops.
UCAB estimates that the 2023 crop area will be 10.1 million hectares (4.4 million hectares of wheat, 3.8 million hectares of corn and 1.4 million hectares of barley). As a result, it is expected to harvest 42.5 million tons of cereals, of which 16.3 million tons of wheat, 21.1 million tons of corn and 4.2 million tons of barley.
Experts estimate the area under oilseeds at 8.9 million hectares, including 5.7 million hectares of sunflower, 2 million hectares of soybeans and 1.2 million hectares of rape. It is noted that Ukraine can expect to get the gross yield of oilseeds at 18.9 million tons, including 12.2 million tons of sunflower, 3.8 million tons of soybeans and 2.9 million tons of rapeseed.
“According to preliminary estimates, this harvest will fully meet domestic demand and get the export potential at 43 million tons of grains and oilseeds,” forecasts UCAB.
Analysts attributed the lion’s share of last year’s corn harvest, which was in high demand, to the positive factors of the current season. The expansion of area under this crop will contribute to the world tendency to reduce prices for fertilizers, which will be felt in Ukraine as well and this will provide maize with their sufficient quantity.
They advised to remember that the introduction of corn production has certain technological difficulties for farmers: the current high saturation with oil-bearing crops, the possible further disease pressure, increased load on combines because of the overlap of harvest periods of other crops, the lack of quality seeds of other crops, etc.
The UCAB also pointed out that since the beginning of the war, the main consumers of oilseeds were EU countries, primarily neighboring countries. However, because of the temporary restrictions on imports of some grains by them, further increase of areas sown with oil-bearing crops looks risky.
According to analysts, Ukraine managed to survive the Russian energy terror and adapt to the new realities, gives hope to the ability of farmers to withstand a possible repetition of the situation.
TAS Agro agrarian group will reduce sowing areas of oilseeds, expand the grain group and start growing sugar beet in season 2023, the company’s press service said.
“Despite the late start of the sowing season caused by weather conditions, all works will be performed in optimal agronomic terms. Modern technological complexes, which increase the accuracy of seeding and increase the productivity of works, are involved in the sowing campaign”, – stated in the press release.
It is specified that the spring sowing campaign in Kirovograd region started with sunflower sowing.
“TAS Agro” is planning to sow 23.3 thousand hectares of corn, 16.1 thousand hectares of sunflower and 11.5 thousand hectares of soybeans in 2023. “Compared to the last year we are going to reduce the area of oil crops and increase the area of grain group. Sowing area in the company as a whole has not changed, but because of food security and market situation this season sugar beet was added to the structure of crops”, – stressed the press service.
After the end of the sowing season the holding will make additional application of nitrogen fertilizers. The company intends to change the technology of plant nutrition, for which the yield of crops in each field over the past five years has been analyzed. According to the data received, the fields were divided into categories, according to which the yield and nutrition system will be planned. “We will be able to not just save money, but increase the efficiency of the money invested in fertilizers,” the company notes.
Before the war TAS Agro worked 83 thousand hectares in Vinnitsa, Kiev, Kirovograd, Chernigov, Nikolaev, Sumy, Kherson and Dnipropetrovsk regions, was engaged in dairy farming (up to 5.5 thousand cattle), owned six elevators with simultaneous storage capacity of 250 tons.
TAS Group was founded in 1998. The sphere of its business interests covers the financial sector (banking and insurance segments) and pharmacy, as well as industry, real estate, venture projects.
The founder of TAS is Sergiy Tigipko.
The USAID Agro program will allocate UAH 367 million to co-finance projects to support processing of grains, oilseeds and pulses in Ukraine, the press service of the Ministry of Agrarian Policy reported.
“This will create the potential for the production of products with added value and ensure the expansion of channels and markets. Consequently, qualitatively and quantitatively improve the food security of Ukraine and the world,” the report stresses.
According to USAID, the goal of the project is to improve small agricultural producers’ access to capacities for processing and refining grains, oilseeds and pulses into food, feed, industrial products and biofuel.
As it is specified, it is planned to allocate up to 367 million hryvnia within 20 projects with the term of realization up to two years. It is assumed that the amount of each sub-grant will be from 10 to 36 million UAH and will be discussed individually.
“It is expected that under the projects executors – Ukrainian entities – will provide MSME with expert, technical and financial support to expand the processing of grain, oilseeds and pulses. Activities will be aimed primarily at expanding existing processing facilities, which will lead to increased production of higher value-added cereal products for domestic consumption and export,” the report summarizes.
Transportation of grains and oilseeds from Ukraine to Poland by rail in 2022 increased by 27 times compared to 2021, Rafal Weber, state secretary of Polish Ministry of Infrastructure, said at the International Conference on Transport Development at European level without specifying the absolute figure.
At the same time, Mustafa Nayem, head of Ukraine’s State Agency for Infrastructure Rehabilitation and Development, who attended the conference, noted that new logistics routes may have emerged over that period.
“The activity of Central European countries was decisive in the first weeks and months of the war, so that new logistic routes could have appeared,” his words were quoted by the press service of the Polish ministry on the website of the department.
Nayem stressed that the situation with the growth of traffic requires mobilization from the Polish side and further integration of transport systems of Ukraine and the EU.
Further intensification of trade flows puts Poland before the need to increase the transshipment capacity of port infrastructure, the capacity of which until recently has been a deterrent to the growth of grain shipments from Ukraine, the conference participants noted.
“Ports have to be too big to handle growing cargo flows. The Port of Gdansk is currently reaching its maximum transshipment capacity. We have to anticipate what will happen and prepare more berths,” Lukasz Greinke, director of the Port of Gdańsk, said at the conference.
Last year Poland’s largest seaports, Gdansk, Gdynia and Szczecin-Swinoujscie, handled a total of more than 133 million tons of cargo, a record, said Grzegorz Witkowski, deputy minister of infrastructure of the Republic of Poland.
He stressed that the Polish government will continue to implement ambitious projects in Polish ports, so that they can meet the challenges associated with the inclusion of the transport corridor “Baltic Sea – Black Sea – Aegean Sea” in the main Trans-European transport network TEN-T.
The forecasted gross harvest of grain crops in Ukraine in 2023 could be 34 million tons, which is 37% less than in 2022 and 60% less than in 2021, while the yield of oilseeds is expected to be 19.3 million tons, which is 13% more than in 2022 and 15% less than in 2021.
As reported on the website of the Ukrainian Agribusiness Club Association (UCAB) on Friday, such a reduction in the grain harvest is caused by the reduction of cultivated areas under crops next year by 45%, to 8.7 million hectares.
The reasons for the reduction in the grain harvest next year will be a decrease in the total sown area, a change in the structure of crops in favor of oilseeds and lower yields of grain crops.
UCAB noted that of the 28.4 million hectares under cultivation in 2021, by December 2022 there are 24.6 million hectares of agricultural land (86% of the total area) in the controlled territory of Ukraine, of which 3.8 million hectares are not suitable for agricultural work due to their proximity to the front lines, contamination by mines and shells, etc. In addition, the end of the sowing campaign of winter crops has demonstrated a significant reduction in the sown area – 3.8 million hectares of winter crops have been sown in 2022, which is 43% lower than in 2021.
UCAB stressed that the reason for this trend is the limited ability to export crops, expensive logistics and, as a consequence, a significant difference in prices of crops by region.
“The regions that are geographically close to sea ports and borders with the EU, have a higher price for agricultural products compared to the regions in the north and east of our country. For example, the price of corn with VAT in Transcarpathian region is 6800 UAH per ton, and in Sumy region – 4900 UAH. However, even in western regions the price is unprofitable. Therefore, the proximity of the border with the EU and working ports determines the ability of the relevant areas to continue grain production, “- the association specified in the message.
In turn, next 2023 will see an increase in the area under oilseeds due to their higher margins compared to grain crops and a significant increase in the logistics of grain this year.
“The price of oil-bearing crops is 2 times higher than the price of grain crops on the world market. According to preliminary estimates, the sown areas under grain crops in 2023 will be 8.7 million hectares, which is 22% less than in 2022 and 45% less than in 2021. The projected area sown with oilseeds is 9.7 million hectares, which is 32% more than in 2022 and 9% more than in 2021. For the first time, the area under oilseeds will be larger than that under grains,” the UCAB said in a statement.
In addition, next year’s average yield will decrease by 10-30%, depending on the region and crop, compared to the average yield of previous years due to a 50-60% reduction in fertilizer application, significant amounts of corn left in the fields of the 2022 crop, the lack of agribusiness funding and the need for significant resource savings.
UCAB stressed that taking into account the given gross production volumes and domestic needs of Ukraine the export potential of grains and oilseeds in 2023/24 marketing year (MY, July-June) will be about 35 million tons, or 3 million tons per month. For comparison, in 2021/22 MY export potential was at the level of 85 million tons of grains and oilseeds, or 7 million tons per month.
As reported, Ukraine in 2021 harvested a record crop of cereals, legumes and oilseeds at 106 million tons: 84 million tons of cereals and legumes, and 22.6 million tons of oilseeds.
A total of 32.4 million tons of wheat, 40 million tons of corn, 10 million tons of barley, 581.5 thousand tons of peas, 191 thousand tons of millet and 110 tons of buckwheat were harvested last year. Sunflower harvest amounted to 16.3 million tons, soybeans – 3.4 million tons and rapeseed – 2.9 million tons.
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 August forecast, to 67.5 million tonnes from 64.5 million tonnes, according to the UGA website on Wednesday.
This change in forecasts is due to an increase in the area where the crop will be harvested, as well as an improvement in the average yield from 3.57 tonnes/ha to 3.64 tonnes/ha.
According to it, the total export of grain and oilseeds from Ukraine in the 2022/2023 marketing year (MY, July-June) can reach 47.5 million tonnes (in the forecast for August, 31% less – 32.8 million tonnes), provided that marine grain corridors are operational until the end of the marketing year. At the same time, the transitional balances of agricultural products in the country at the beginning of 2022/2023 MY amounted to 26 million tonnes of grain and oilseeds, and by the end of the MY they are estimated at 19.2 million tonnes (in the forecast for August, 37% more – 30.5 million tonnes).
“In general, export of grain and oilseeds in 2022/2023 MY can be expected at the indicated level if the Ukrainian Black Sea ports continue to operate until the end of the season. Exporting grain through Ukrainian ports and ensuring the safety of navigation in the Black Sea is the only way to quickly and efficiently supply Ukrainian grain to countries that are in dire need of it,” the organization said in a statement.
According to UGA forecasts, in 2022, a wheat harvest is expected at the level of 19.3 million tonnes (1.5% more compared to the August forecast); 24 million tonnes of corn (forecast kept); 5.6 million tonnes of barley (3.7% more); 10 million tonnes of sunflower (11% more); 3.6 million tonnes of soybeans (1.6 times more); and 3.15 million tonnes of rapeseed (5% more).
In the November forecast, the association raised its export forecasts compared to August ones – for example, wheat exports in 2022/2023 MY are expected at the level of 13 million tonnes (33% more), corn – 20 million tonnes (a 2-fold increase), barley – 2 million tonnes (forecast is kept), sunflower – 6 million tonnes (forecast is kept), soybean – 3.5 million tonnes (an increase of 2 times), and rapeseed – 2.8 million tonnes (forecast is kept).
“We estimate the preliminary forecast for the harvest of grain and oilseeds for the next 2023 at the level of 53.2 million tonnes, and export at the level of 39.7 million tonnes. Everything will depend on the conditions under which Ukrainian farmers will be able to carry out spring sowing, and subsequently harvest crops,” the UGA said in the statement.
