Business news from Ukraine

UKRAINE BECOMES LARGEST GRAIN SUPPLIER TO KINGDOM OF THAILAND

Ukraine became the largest supplier of grain to the Kingdom of Thailand and exported products worth more than $140 million in 2019, the press service of the Ukrainian Embassy in Thailand said.
The embassy said on its Facebook page that Ambassador of Ukraine to Thailand Andrii Beshta met with Director General of the Department of Trade Negotiations of the Ministry of Commerce of the Kingdom of Thailand Auramon Supthaweethum, during which the cooperation between the countries on trade and investment was discussed.
“Therefore, during the meeting, the parties discussed the implementation of the Trade Agreement signed in 2017 between the governments of Ukraine and Thailand, in particular, the importance of holding an inaugural meeting of the Joint Trade Commission and the Ukraine-Thailand Business Forum by the end of 2020,” the embassy said in the statement.
It is noted that Ukraine became the largest supplier of grain to Thailand and exported this type of product in the amount of more than $140 million over 2019. The total trade in goods and services between Ukraine and Thailand amounted to $570 million with a surplus of more than $116 million for Ukraine in 2019.

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EBRD TO PROVIDE EUR 7 MLN LOAN TO UKRAINIAN GRAIN ALLIANCE

The European Bank for Reconstruction and Development (EBRD) plans to provide a senior secured loan of up to EUR 7 million to Baryshevska Grain Company LLC, the main operating company of the Grain Alliance Group, under the Resilience Framework. The Loan will be used to finance working capital needs of the Group amid the adverse impact of COVID-19 on its business.
According to a posting on the bank’s website, the project was approved in the context of the EBRD’s response to the COVID-19 pandemic.
“The loan will support the group’s liquidity and help it withstand the COVID-19-caused crisis. Therefore, it will help the company to preserve its capital expenditure plans, which were part of the original project between the Bank and Grain Alliance approved in 2019,” the EBRD said.
The original transition impact objectives are as follows: improvement in infrastructure for logistics, storage and transportation for export facilitation especially for small third-party farmers and installation of two biomass-fired grain dryers with total capacity of 24 MW utilizing sunflower residues, including husk, dust and broken kernels generated during the operational activity of the group.
The EBRD said that the status of the project is pending final review.

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AGRARIAN FUND BUYS 72,000 TONNES OF GRAIN UNDER FORWARD CONTRACTS

PJSC Agrarian Fund financed UAH 233 million under the forward program for agricultural producers, purchasing 72,000 tonnes of grain crops.
According to a report on the company’s website on Tuesday, the spring forward program of the company will last as long as applications from producers arrive.
“To date, PJSC Agrarian Fund funded agricultural producers for UAH 233 million by purchasing 72,000 tonnes of grain. Yes, this is not enough compared to previous years, but the forward program has not yet been completed, and contracts will be concluded while applications from agrarians arrive,” acting Head of the Agrarian Fund Bohdan Bunchuk said.
Under the terms of the 2020 forward program, financing is provided in mineral fertilizers and cash. Funds in the financing structure can be up to 50% of the contract amount. The collateral is the grain of the 2020 harvest.

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UKRAINIAN GRAIN ASSOCIATION: DOUBLING OF IMPORT DUTIES BY EC NOT TO AFFECT MAIZE EXPORT

The decision of the European Commission to increase import duties for maize from EUR 5.27 to EUR 10.40 per tonne is not a threat to export of Ukrainian maize, Prse of the Ukrainian Grain Association (UGA) Mykola Horbachev has said.
“Changing the duties for maize is exclusively the market mechanism for protecting the domestic market, and not an administrative one. So, when the price for maize on the exchange grows, the duty is leveled, and when it falls, the duty increases. This practice works automatically and is not something new for the market, after all, at least it have existed for the past 20 years, or even more,” he told Interfax-Ukraine.
The president of the UGA said that in Ukraine the potential for the export of maize has actually been exhausted in the current agricultural year.
“Today, about 26 million tonnes out of the expected 29-30 million tonnes have been exported. Thus, Ukraine has already managed to supply most of maize to the EU,” Horbachev said.
This decision will also not have an impact on maize exports in the next season, as crop prices may increase with a new crop. The association said that share of the total Ukrainian maize exports to the EU is about 45%. To date, Ukraine has already supplied about 10.5 million tonnes of maize to the EU.
The European Commission from April 27, 2020 fixed the import duties in the cereals sector. The import duties for maize, sorghum and rye are now fixed at EUR 5.27 per tonne and the automatic calculation lead to a new figure of EUR 10.40 per tonne on May 6.

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ECONOMY MINISTRY IMPROVES FORECAST FOR GRAIN HARVEST IN UKRAINE

The Ministry of Economic Development, Trade and Agriculture predicts that Ukrainian farmers will harvest 63-65 million tonnes of grain and leguminous crops in 2020 against the previously projected 60 million tonnes. “Looking at the sown area, we expect the final gross grain production at the level of 63-65 million tonnes, which is 2.5 times more than the domestic market needs. We can formulate the final figure at the end of May, everything will depend on rains in this period. According to the forecast, they should be. Perhaps even the figure will be larger,” Deputy Economy Minister Taras Vysotsky said on the air of Ukraine 24 TV Channel.
Vysotsky noted that there are no threats to food security nationwide due to adverse climatic conditions, a critical situation has developed only in Odesa region.
“The losses there are large, sometimes up to 50% of the sowings. Now they’ll sum up the potential losses, they will transfer documentation, hold commissions and consider the possibility of financing from the reserve fund or other available instruments. We will study the situation in this region to support those farmers who have a large percentage of losses and there is a risk of becoming bankrupt,” the official said.

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GRAIN HARVEST IN UKRAINE IN 2020 MAY REACH 72 MLN TONNES

The grain harvest in 2020 may reach about 72 million tonnes (75.1 million tonnes in 2019), about 51 million tonnes from this volume can be exported, UkrAgroConsult analytical agency said.
“Despite draughts in March and April, in case of May rainfall, the wheat harvest’s level will be high enough, about 26 million tonnes (28.3 million tonnes in 2019). At the same time, its yield is forecast to be 5% lower than the trend value and 5% lower than last year,” UkrAgroConsult said on its website.
According to leading expert on the grain market Yelyzaveta Malyshko, with such harvest, Ukraine may well export 17 million tonnes of wheat.
According to preliminary forecasts, the corn harvest may reach 36 million tonnes in 2020 (35.9 million tonnes in 2019), and barley of 8 million tonnes (8.9 million tonnes).