Business news from Ukraine

Ukraine will be able to harvest more than 4 mln tons of rapeseed – forecast

Ukraine will be able to harvest more than 4 mln tonnes of rapeseed in the season-2024, UkrAgroConsult analytical agency forecasts.

“The State Statistics Service released the official data on the rapeseed harvest in 2023 – 4.2 mln tonnes (+26% compared to 2022/2023 MY), but the export and domestic processing rates prove that the official statistics need to be reassessed,” the analysts said.

They reminded that the export of rapeseed and processed products continues to be at the record pace even in the last months of the season. During the 10 months of the season, the country exported 3586.2 thsd tonnes of rapeseed (+5% compared to 2022/23 MY), 134.1 thsd tonnes in April; 406.1 thsd tonnes of rapeseed oil; 351.9 thsd tonnes of rapeseed meal.

Experts believe that the 2024 rapeseed harvest can also be forecasted on the basis of the revised estimates, according to which it may reach more than 4 mln tonnes.

“Weather remains the key factor in the yield formation. The impact of the cold wave and night frosts on the soil in early May is yet to be assessed, so in the future, the forecast of rapeseed harvest may be reduced,” UkrAgroConsult said.


Rapeseed production in Ukraine may reach 4.3 mln tons this year

The production of rapeseed in Ukraine in 2024 may reach 4.3 mln tonnes, up 4% from the previous estimate, but 7% down from the 2023 figures, according to the forecast of APK-Inform information and analytical agency.

“The forecast was adjusted due to the increase of the planted area under this crop to 1.49 mln ha (+4% to the previous estimate; -4% to 2023),” the analysts explained.

They also increased the export potential of rapeseed in 2024/2025 MY to 3.6 mln tonnes, up 2% from the previous estimate, but 2% down from the previous season-2023/2024.

Experts noted that the condition of winter rapeseed after wintering was mostly assessed as good and satisfactory. However, the lack of moisture observed in the soil due to the rather dry March and the first half of April raised concerns about the yield potential. The situation is expected to be affected by the cyclone that entered the country this week.

“The popularity of rapeseed in Ukraine has increased significantly in recent years, driven by the consistently high demand for the oilseed from European importers. Therefore, rapeseed in Ukraine is now one of the most highly liquid crops and it is a fairly quick way for an agricultural producer to get money,” the agency stated.

In addition, in the last few years, the price of rapeseed on the domestic market has been quite attractive for farmers and among the key oilseeds is second only to soybean prices, but it is quite sensitive to world production and to the price dynamics on the European market of this oilseed.

“In the new season, the prospects for Ukrainian rapeseed are also quite good: the production of this oilseed in the EU is expected to decrease (from -2% according to the European Commission to -10% according to Strategie Grains), which is already creating a rush in the market. However, according to the recent estimates of FAS USDA, in 2024 the production of Australian canola may increase by 14%, which together with Canadian oilseed is the direct competitor of Ukrainian rapeseed on the European market,” – forecasts APK-Inform.

Corteva Agriscience increased sales of sunflower seeds by 30%, winter rapeseed by 80%, and pesticides by 13%

Corteva Agriscience, an international agricultural research company, increased organic sales of sunflower seeds and winter rapeseed by 30% and 80%, respectively, in 2023 compared to 2022, its press service reports.

According to the press release, despite the reduction of corn acreage in Ukraine due to the military actions, Corteva increased its presence in the farms that continued to grow this legume.

The company’s sales growth was driven by an effective direct model of cooperation with farmers, an extensive network of sales agents and representatives, and comprehensive agronomic support for farmers throughout Ukraine. In addition, Corteva has partnered with the Howard G. Buffett Foundation to provide additional rapeseed, corn and sunflower seeds for planting to small Ukrainian farmers in the affected areas, the company said.

Corteva also reported that, despite the overall decline in the crop protection market in Ukraine, the company’s organic sales in 2023 increased by 13% compared to last year. At the same time, the demand for Corteva insecticides doubled compared to 2022.

“Such results reflect the company’s focus on providing farmers with the latest and most advanced products to increase agricultural productivity in Ukraine, as declared in the joint declaration between Corteva Agriculture and the Ministry of Agrarian Policy and Food of Ukraine on deepening and further developing cooperation for food security in Ukraine and the world,” the statement said.

“Almost two years after the start of the full-scale war, we at Corteva have been working side by side with Ukrainian farmers to help them meet the new challenges they face. We have transformed the company’s work in accordance with the current conditions and learned to work in marathon mode. Farmers consider us to be their reliable partners, which is evidenced by the fact that the number of customers remains unchanged despite the overall market contraction. Our team is doing everything possible, demonstrating extraordinary dynamics in 2024,” said Oleksandr Dmytriyev, Corteva Agriscience’s business manager in Ukraine.

As reported, the world’s leading agrochemical company’s operating EBITDA in 2023 increased by 5% year-on-year, while operating profit per share increased by 1% over the same period.

Corteva Agriscience forecasts that in 2024 its net sales will be in the range of $17.4-17.7 billion and operating EBITDA in the range of $3.5-3.7 billion.

Corteva Agriculture is a global agricultural company. It offers comprehensive solutions to maximize yields and profitability. It has more than 150 research facilities and more than 65 active ingredients in its portfolio.

The company’s presence in Ukraine includes the headquarters in Kyiv, a research center in Liubarky (Kyiv region) and a seed production complex in Stasi (Poltava region).

In April 2022, the company decided to leave the Russian market due to the full-scale war against Ukraine unleashed by Russia.

, , , ,

Bulgaria allows licensed imports of Ukrainian sunflower, rapeseed, corn and wheat

Bulgaria has authorized licensed imports of Ukrainian sunflower, rapeseed, corn and wheat, according to the website of the Ministry of Agriculture and Food of Bulgaria.

According to the report, during an online meeting on Friday, the Ministers of Agriculture of Bulgaria and Ukraine Kirill Vatev and Nikolay Solsky agreed to implement a licensed export regime for sunflower, rapeseed, corn and wheat seeds and agreed on the details of its application.

“The Ministry of Agriculture and Food has kept its promise to limit imports of these agricultural products as much as possible until November 30, according to the Memorandum signed between the government and the Initiative Committee of Protesting Farmers,” the Bulgarian ministry quoted Minister Vatev as saying.

He emphasized that after this period, the two countries will “strictly monitor that there are no market distortions and that the interests of Bulgarian producers, processors and consumers are not undermined.”

Imports and data exchange between the two countries will continue, the Bulgarian ministry emphasized.

As reported, in November 2023, the Minister of Agrarian Policy of Ukraine Solsky expressed the opinion that Bulgaria, which refrained from imposing a unilateral ban after September 15, could become the first frontline country to lift the ban on Ukrainian agricultural products.

In his opinion, the crop that Bulgaria will be ready to import from Ukraine will be sunflower. In Bulgaria, in the fall of 2023, a compromise was reached between farmers and processors to open the market for imports of Ukrainian sunflower from December 1. By this time, local sunflower oil producers, according to the Bulgarian government, will have to buy back the sunflower seeds produced by farmers, and they will need an additional 1.5 million tons of raw materials.

Earlier, Stepan Kapshuk, head of the industry association Ukroliyaprom, told Interfax-Ukraine that Bulgaria has 16 oil extraction plants that have significantly increased production in the 2022 season and intend to develop sunflower oil exports using sunflower seeds imported from Ukraine.

On September 15, the European Commission announced that it would not extend the restrictions on imports of agricultural products from Ukraine to five neighboring EU countries (Poland, Bulgaria, Hungary, Romania, and Slovakia) under certain conditions that will help avoid a new sharp increase in supplies.

The restrictions were introduced on May 2, 2023, and applied to imports of wheat, rapeseed, sunflower, and corn. These five Eastern European EU member states argued that Ukrainian agricultural products, when imported duty-free into the EU, were being deposited in their countries and were harming their local agricultural sectors.

After the restrictions were lifted, Poland, Hungary, and Slovakia imposed unilateral bans. Poland expanded its list of banned products to include rapeseed cake and meal, as well as corn bran, wheat flour, and derivatives. Hungary extended the list to 24 commodity items.

Ukraine filed a lawsuit with the WTO, accusing Poland, Hungary, and Slovakia of discriminatory treatment of its agricultural products.

Ukraine is currently negotiating a mechanism for licensing exports of Ukrainian agricultural products with mandatory verification in each of the five countries.

, , , , ,

Nibulon to buy 13 HORSCH seeders for sowing corn, rapeseed and sunflower

One of the largest grain market operators in Ukraine, JV Nibulon LLC (Mykolaiv), has signed an agreement with German agricultural machinery manufacturer HORSCH to purchase 13 seeders for sowing corn, rapeseed and sunflower at the AGRITECHNICA-2023 exhibition in Hannover.

“HORSCH Maestro seed drills are among the best and most technologically advanced on the sowing equipment market. They are convenient and productive, and their high sowing accuracy will allow us to perform operations efficiently and quickly at operating speeds of up to 15 km/h,” the company wrote on Facebook.

Nibulon explained its choice by the constant improvement of the machines by the manufacturer, testing on a production scale, including in Ukraine. In addition, HORSCH has a well-developed service base in Ukraine, which allows it to operate and maintain equipment with minimal downtime.

“We are striving to optimize our production processes and improve the quality and productivity of sowing to a new level,” Nibulon summarized and thanked HORSCH for its cooperation.

As reported, Nibulon also signed an agreement to purchase 29 agricultural machines with German agricultural machinery manufacturer CLAAS at AGRITECHNICA-2023. It is planned that 10 combines, 15 tractors and 4 telescopic loaders will be used for crop production in the 2024 season.

Nibulon JV LLC was established in 1991. Prior to the Russian military invasion, the grain trader had 27 transshipment terminals and crop reception complexes, a one-time storage capacity of 2.25 million tons of agricultural products, a fleet of 83 vessels (including 23 tugs), and owned the Mykolaiv Shipyard.

“Before the war, Nibulon cultivated 82 thousand hectares of land in 12 regions of Ukraine and exported agricultural products to more than 70 countries.

In 2021, the grain trader exported the highest ever 5.64 million tons of agricultural products, reaching record volumes of supplies to foreign markets in August – 0.7 million tons, in the fourth quarter – 1.88 million tons, and in the second half of the year – 3.71 million tons.

Nibulon’s losses from Russia’s full-scale military invasion reached $400 million. The grain trader is currently operating at 30% of capacity and has set up a special unit to clear agricultural land of mines.

, , , ,

Kernel reduces sunflower and rapeseed processing by 5%

“Kernel, one of the largest Ukrainian agro-industrial groups, processed 610 thousand tons of sunflower and rapeseed at its oil extraction plants in the first quarter of the 2023/24 fiscal year (FY, July 2023 – June 2024), down 5% year-on-year.

“Due to the seasonal shortage of sunflower seeds at the end of the processing season (the new harvest will be in September-October 2023), the Group switched to rapeseed processing at two of its plants, processing 112 thousand tons for the three months ended September 30, 2023,” the company said in its financial report posted on its website over the weekend.

According to the report, the volume of edible oil sales in the first quarter of 2023/24 FY increased by 16% compared to the previous quarter and amounted to 369 thsd tonnes, including 20 thsd tonnes of bottled sunflower oil and 19 thsd tonnes of rapeseed oil.

In addition, the increase in yields and the increase in acreage under wheat, sunflower and soybeans harvested by Kernel’s agricultural enterprises, according to the data for the 1st quarter of 2023/24 fiscal year, led to an increase in the volumes received for storage at the group’s elevators to 1.208 million tons, which is 2.3 times more than a year earlier.

The agroholding noted that due to the termination of the Black Sea Grain Initiative on July 18, 2023, the throughput capacity of Kernel’s export terminals in Ukraine decreased significantly to 162 thsd tonnes in the first quarter of 2023/24, which is 83% less than in the previous quarter. Half of the exported agri-goods were shipped through Kernel’s infrastructure facilities in the port of Reni on the Danube.

Ukraine exported 203 thsd tonnes of grain in the first quarter of 2023/24, down 68% quarter-on-quarter. Most of the grain was exported via Ukrainian ports on the Danube and by rail to the Romanian port of Constanta, as Kernel’s usual export routes – Ukrainian Black Sea ports – were unavailable for export operations due to Russia’s unilateral termination of the Black Sea Grain Initiative in July 2023, the financial report says.

According to the agroholding, alternative export channels for Ukrainian agricultural products lead to high logistics costs, which, against the backdrop of low global grain prices, lead to a reduction in exports.

In this regard, Kernel has made significant changes to the structure of crops grown to minimize the area under the most energy-intensive and logistically complex crops (grains and corn) in favor of less energy-intensive soybeans and wheat.

As of September 30, the agronomic division completed the harvest of wheat, sunflower and soybeans on 61 thou hectares, 119.8 thou hectares and 65 thou hectares, respectively. The yields of all crops were better than expected due to favorable weather conditions and amounted to 6.7 t/ha of wheat, 2.9 t/ha of sunflower, and 2.9 t/ha of soybeans.

Corn harvesting from 84.4 thou hectares is still ongoing. Approximately half of the area has not yet been harvested. As a result of the harvesting campaign, Kernel expects to achieve a corn yield of 9.5 tons per hectare.

Prior to the war, Kernel was the world’s largest producer of sunflower oil (about 7% of global production) and a major exporter (about 12%). It is one of the largest producers and sellers of bottled oil in Ukraine. It is also engaged in the cultivation and sale of agricultural products.

Kernel’s net profit for FY2023 amounted to $299 million, while the previous year it ended with a net loss of $41 million. The agricultural holding’s revenue for FY2023 decreased by 35% to $3.455 billion, but EBITDA increased 2.5 times to $544 million.

, ,