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Russia to plan to harvest 85 mln tonnes of grains in 2011

Despite the anomaly weather conditions and due to the opportune Governmental support measures, in 2010 the general grain productions in Russia totals 60.3 mln tonnes in clean weight, down 35% compared to the level of 2009, but it is the sufficient volume for the domestic demands satisfaction, stated Elena Skrynnik, the Minister of Agriculture of the Russian Federation, on December 23.

According to the Ministry forecasts, as of July 1, 2011, grain stocks are expected at the level of 14 mln tonnes.

The country harvested the record volumes of rice and soybean – over 1.1 mln tonnes and 1.2 mln tonnes, respectively.

Taking into account winter crops sowing areas decrease by 16% (the general sowing areas totaled 15.5 mln ha) compared to the last year level, in 2011 Russian agricultural commodities producers will have to increase spring crops sowing areas till 30 mln ha. Grain production in 2011 is planned to reach the level of 85 mln tonnes.

Ukraine to experience massive sale of farmlands

The farmland sale moratorium may be lifted in Ukraine as soon as early next year, said Presidential Administration Head Sergey Lyovochkin. President Viktor Yanukovych has repeatedly said that this needs to be done within the near future. This implies new investments, new practices. Besides, land is a renewable resource. Experts welcome the news about possible lifting of the farmland sale moratorium. They say, it’s a common practice worldwide, i.e. Ukraine should not be an exception. To lift the moratorium on farmland sales, a law on state land cadastre needs to be passed. Naturally, we predict that following this step Ukraine will experience a redistribution of land ownership.

Ukraine: Khleb Investbud to export 1 mln tonnes of grains

Khleb Investbud Ltd. is to realize the intergovernmental agreements for exporting of 1 mln tonnes of grains from Ukraine, declared Robert Brovdy, the Director of Khleb Investbud Ltd., on December 27.

According to him, the enterprise represents the interest of the state company, and realizes various intergovernmental agreements by instruction of the Government.

R.Brovdy informed that the company will provide supplies of grains, including milling wheat and feed maize, to the range of countries, in particular, Russia, Georgia and Armenia. He specified that the grain cargo, exported in accordance to the intergovernmental agreements, does not come under the general grain export quotas.

R.Brovdy also marked that to date Ukraine provides negotiating process with several countries about conclusion of the corresponding intergovernmental agreements for supplying of grains.

State Food-Grain Corporation of Ukraine to store over 3 mln tonnes of grains

Grain elevators of the State Food-Grain Corporation of Ukraine are able to stock over 3 mln tonnes of grains, declared Alexander Lavrinchik, the General Director of the state enterprise “State Food-Grain Corporation of Ukraine”.

According to A.Lavrinchik, the company has capacities to keep over 3 mln tonnes of grains, but to date the company stores nearly 1 mln tonnes of grains.

Ukraine: Cabinet of Ministers promulgated the decree on prolongation of grain export quotas

The Cabinet of Ministers of Ukraine prolonged the quota regime of grain exports till March 31, 2011, informed the Decree of the Cabinet of Ministers No1182, dd. December 6, 2010, published on December 28, 2010.

The Decree makes alternations to the Decree No938, dd. October 6, 2010, “On confirmation of quota volumes for the certain varieties of agricultural products, which exports to be subject to licensing till December 31, 2010, and adoption of the Order of issuance of the licenses for exports of the certain range of agricultural products and quotas distribution”.

The Cabinet of Ministers also increased the quota volumes for wheat exports from 500 thsd tonnes to the level of 1 mln tonnes, and maize – from 2 mln tonnes to 3 mln tonnes. At the same time, the Government excluded seed maize from the quota regime.

According to the renewed order of issuance of licenses for grain exports, the distribution of grain export quotas is realized on the basis of the application, provided to the Ministry of Economic Development and Trade by the agent of economic activity during the period of 7 calendar days, instead of 15 calendar days after the official promulgation of the beginning of such application acceptance.

Besides, the Decree of the Cabinet of Ministers of Ukraine No1046 dd. November 10, 2010, “On introduction of alterations to the decree of the Cabinet of Ministers of Ukraine #938 dd. October 4, 2010” became annulled, according to the reporting Decree.

Ukraine able to export another 10 m tons of grain

Abolishment of export quotas earlier than it was expected will give possibility to agricultural enterprises to export the accumulated considerable grain stocks of this year yield. The Economy Ministry made public the draft resolution about prolongation of quotas for grain export since the end of the year till March 31, 2011 and their expansion by 1.5 million tons to 4.2 million tons.The grain export potential in 2010-2011 marketing year (July-June) can be estimated at 15-16 million tons. In July-November, Ukraine exported 5.4 million tons of grain that provides for possibility to export another 10 million tons.

Russia: Ministry of Agriculture offers to zero import duties for barley and feed wheat

The Ministry of Agriculture of the Russian Federation presented a proposal to zero import duties for grains, in particular for barley and feed wheat, declared Elena Skrynnik, the Minister of Agriculture of the Russian Federation, on December 23.

Besides, the Minister marked that in order to stabilize the situation on the grain market, in the nearest future the Ministry will start selling 900 thsd tonnes of grains from the public intervention fund in four regions of the country (Moscow, St. Petersburg, Moscow and Leningrad oblasts).

Kazakhstan plans to cancel grain export licensing

Kazakhstan plans to cancel licensing of grain export operations, declared Akhylbek Kurishbaev, the Minister of Agriculture of the Republic of Kazakhstan.

In accordance with the decree of the Government, the Ministry of Economic Development and Trade worked out the project of the Law “On alternation of amendments and additions to the certain legislative acts of the Republic of Kazakhstan concerning the issues of development of the licensing system”, informed the Head of the Ministry.

According to him, the project of the Law provides exclusion of licensing of business activity for grain export selling from the general list of licensed commodities.

From the beginning of 2010/11 MY, Ukraine exported 5.9 mln tonnes of grains

From the beginning of the current MY and as of December 22, 2010, grain exports from Ukraine totaled 5.9 mln tonnes, declared Alexander Demidov, the Director of the Department of plant growing markets of the Ministry of Agrarian Policy and Food of Ukraine, on December 23.

According to him, in particular, Ukraine exported 2.4 mln tonnes of wheat, 2.3 mln tonnes of barley and 1.067 mln tonnes of maize.

At the same time, he marked that during 20 days of December the country exported nearly 900 thsd tonnes of grains.

A.Demidov also added that the Government will possibly examine the issue of prolongation or cancellation of the export quotas for grains in January 2011, after clearance of the situation with grain balances on the domestic market.

Russia: grain production in clean weight to total 60.35 mln tonnes

The rates of agricultural production volumes decrease in Russia become slower, stated the monitoring of the social-economic situation in the Russian Federation, published by the Ministry of Economic Development of the Russian Federation on December 22.

It is announced that in November 2010, agricultural commodities production in the country decreased by 4% compared to the November 2009, according to the preliminary data. The production volumes faced an increase during the third month in a row, excluding the seasonal and calendar factors. In November, the increase totaled 4.5% compared to October, stated the estimation of the Ministry of Economic Development of Russia.

According to data of the Ministry of Economic Development of Russia, in January-November of 2010, there was slowdown of the increase of agricultural commodities production rates. Thus, production of agricultural commodities volumes totaled 256.9 bln RUR at the current prices in farming enterprises of all the categories in November 2010, and decreased by 4% compared to the same period of the last year. During the period of January-November of 2010, the index decreased by 12.4% (2289.5 bln RUR).

Plant growing production volumes decrease also effected at agricultural commodities production volumes decrease, caused by the summer droughts in the essential part of the subjects of the Russian Federation.

According to data of the Ministry of Agriculture of Russia, in 2010 grain and leguminous plants were harvested throughout 33.3 mln ha (98.7% of the general harvesting areas, and 78% by 2009). The average yield totaled 19.3 c/ha (23.9 c/ha in 2009), grain production volumes totaled 64.2 mln tonnes, and decreased by 37.7 mln tonnes, or 37% compared to the last year level. Winter and spring wheat production volumes totaled 43.6 mln tonnes, the yield reached the level of 20.3 c/ha.

Grain production volumes in clean weight will possibly total 60.35 mln tonnes in the current year.

Barley, millet, buckwheat production decrease was caused by the yield decrease in the terms of the harvested areas decrease; sunflower, sugar beet and maize fall of production – caused by the yield decrease; rapeseed – caused by harvesting areas decrease.

Rice production volumes increased by 160 thsd tonnes, which was caused by the yield increase and sowing area increase.

Winter grains were sowed throughout 15.5 mln ha, which totals 99.7% to the forecasted sowing areas for the harvest-2011, and 82.4% to the areas, sowed by winter crops last year.

It is also noted that rather unfavorable weather conditions in 2009-2010 negatively effected the financial condition of agricultural producers, which caused the decrease of machinery renewing rates.

Ukraine: Decree of the Cabinet of Ministers regarding export issues of the certain varieties of agricultural products comes into force

The Decree of the Cabinet of Ministers of Ukraine No2274-r “Certain issues of exports of several varieties of agricultural commodities” dd. November 29, 2010, came into force. The document was published in the newspaper Uriadovyi Courier dd. December 23, 2010.

According to the Decree, as it was previously announced, the Cabinet of Ministers ordered to the Ministry of Agrarian Policy and Food, the Ministry of Economic Development and Trade and the State Customs Service to coordinate export processes of grains to the CIS countries, Georgia and Macedonia, which have the signed agreements about free trade with Ukraine.

Previously, the Ministry of Economy offered to cancel grain export quotas to the countries, having the signed agreements about free trade with Ukraine, till 2011.

Ukraine to possibly cancel grain export quotas at the beginning of 2011

At the beginning of 2011, the Government of Ukraine plans to examine the possibility of cancellation of grain export quotas, declared Nikholay Prysiazhnyuk, the Minister of Agrarian Policy and Food of Ukraine, on December 22.

According to the Minister, the Prime-Minister provided the order to actually cancel the quota regime at the end of January – beginning of February.

At the same time, he marked that the Government will make the decision taking into account the presence of sufficient grain volumes in the country.

As a reminder, from October 19 till December 31, 2010, Ukraine imposed quotas for exports of 2.7 mln tonnes of grains, including 0.5 mln tonnes of wheat, 0.2 mln tonnes of barley, 2 mln tonnes of maize, 1 thsd tonnes of rye and buckwheat each.

At the beginning of December, N.Prysiazhnyuk informed that the Government prolonged the terms of grain export quotas till March 31, 2011, and increased the quota volumes by 1.5 mln tonnes for the period. However, the corresponding governmental document was not promulgated yet.

Ukrainian Grain Crop Totals 41.5 Million Tons

Ukraine has harvested 41.5 million metric tons of grain in the current season, Interfax-Ukraine reported, citing preliminary data from the Agriculture Policy Ministry.

The average grain yield was 2.85 tons a hectare (2.47 acres), down from 3.12 tons a hectare a year earlier, Interfax said.

Ukraine: agrarians to lose 1 mln tonnes of maize, due to the export limitations

Due to maize export limitations and flooded elevators, Ukrainian agrarians had to stop maize harvesting campaign. The grain losses totaled 1 mln tonnes. The estimation was introduced by Leonid Kozachenko, the President of the Ukrainian Agrarian Confederation.

During the recent three month (since imposition of the grain export quotas), damaged maize volumes reached the level of 1 mln tonnes. The volumes are damaged, agrarians utilize the maize, due to the impossibility to export it.

According to the announcement, due to rather small quotas volumes and also non-operative distribution, the market formed the shortage of capacities for grain storage.

Maize, which harvesting campaign starts at the latest terms, is in the most difficult situation, because at the moment of the harvesting campaign beginning, the elevators were completely overstocked. The situation was complicated by the fact that in the current year maize harvested volumes totaled the highest level for all the years of Ukraine independence and total over 12 mln tonnes.

Maize was loaded to all suitable storing capacities (for example Nibulon company loaded maize to own barges standing in the rivers), however soon all the reserves were fulfilled. Unfortunately, agrarian companies had to stop maize harvesting campaign even in own farming-enterprises, stated Aleksey Vadaturskiy, the Head of Nibulon.

 Cargill invests in new animal feed mill in Ukraine

Cargill announced on Dec. 17 plans to invest $7 million in Ukraine to construct a new animal feed mill. The feed mill, which will be built in Kutsovka, marks the company's entry into the animal nutrition market in Ukraine.

The mill has the capacity to produce, mix and pellet approximately 50,000 tonnes of bagged and bulk animal feeds per year. Construction is expected to begin in January 2011, and it is anticipated that the facility will be operational by the end of 2011. The new facility is expected to employ up to 40 full-time positions.

"By entering the animal nutrition market in Ukraine, we are expanding Cargill's existing network of animal feed plants globally in order to meet the growing demands of the livestock industry," said Dan Burke, head of Cargill's animal nutrition business in Europe. "In recent years, we have seen a significant increase in meat consumption and meat production in Eastern Europe. This investment will enable us to leverage our global expertise, technology and knowledge to support the growth of this renewed livestock sector in Ukraine."

Once operational, the mill will distribute feed, under the Purina brand, to local dairy, swine and poultry livestock farmers through a dealer network. Cargill expects this network will be made up of over 100 dealers in three years' time. While the mill is being built, Cargill intends to explore opportunities to help meet current local demand for animal feed.

Cargill has been based in Ukraine since 1991, and it has a significant presence mainly in the food and agricultural sectors, including grain and oilseeds origination and processing. With over 700 Ukraine-based employees, Cargill is one of the leading foreign investors in Ukraine.

"With significant operations on the ground, we plan to draw on synergies from our established grain and oilseed business and to leverage valuable contacts and existing relationships built up by our long-term commitment to Ukraine," said Malcolm Sayer, general manager of Cargill's animal nutrition business in Ukraine. "We are fortunate to have received strong ongoing support from both the agricultural community and government and we believe we have a meaningful role to play in this sector and, in the process, help raise rural GDP and support local farmers' incomes."        

Egypt discusses wheat security pact with Russians

Egypt's trade and industry minister, Rachid Mohamed Rachid, has met with his Russian counterpart to try negotiate a long-term agreement to ensure supplies of wheat.
At a press conference, he said he had discussed a long term agreement with Russia to secure uninterrupted supply of Russian wheat, irrespective of any force majeure.

Russia is able to come back on the world grain market

There are no any problems for Russian grains to come back on the world grain market, stated Arkadiy Zlochevskiy, the President of the Russian Grain Union. However, the price for Russian grains should certainly be lower compared to the competitors price, due to the risks presence, noted A.Zlochevskiy. The Administrative decisions unpredictability may become the risk in the case, and as consequence, contracts non-compliance.

While talking about the harvest results in 2010, A.Zlochevskiy noted that the final rate of grains harvesting totaled 62.5 mln tonnes, but not 60.5 mln tonnes, according to the official data of the regions. At the same time, agrarians hid about 3 mln tonnes as losses, due to the droughts. Probably, it is due to the fact that Russian grain producers did not receive compensation of own losses in the full volume. The devoted funds by the Government covered only 20-25% of the damage, and even part of the funds did not reach agrarians, stated A.Zlochevskiy.

Besides, the Head of the Russian Grain Union noted that according to the analysis of the droughts in 2010 – 60-80% of the losses were not due to the weather condition, but due to the technological reasons.

If the agricultural technologies were observed bu agrarians, the droughts could decrease grain production volumes by 4-7 mln tonnes, but not by 37 mln tonnes, assured A.Zlochevskiy.

The President of the Russian Grain Union explained that gradual slowly increase of the manufacturability in grain production during 10 years with culmination in the season of 2007-2008 stopped in the conditions of the world economic crisis, which was during the grains season of 2008-2009.

Grain productions manufacturability decreased in Russia till the level of lower than before the crisis. To date, the condition of manufacturability processing on the fields is not the best, resumed A.Zlochevskiy.

In 2010, Russia lowered grain production by 38%

During January-November of 2010, the general volume of agricultural production in Russia decreased by 12.4% as opposed to the same period of the last year, and totaled 2289.5 bln RUR, declared the Federal State Statistics Service of the Russian Federation (Rosstat).

As of December 1, 2010, agricultural enterprises in Russia harvested grains and leguminous plants throughout the areas of 76% of the sowings, including grains – 58.3%. Agrarians harvested sunflower seed throughout 76.8% of the planned harvesting areas.

Agricultural enterprises of all varieties of the Russian Federation (agricultural organizations, farmers and the population) produced 63.4 mln tonnes of grains in bunker weight, a decrease of 38.2% compared to the same date of the previous year, and 5.3 mln tonnes of sunflower seed, down 17.2%.

Traditionally, agricultural enterprises produced the main share of grains (77.1%) and sunflower seed (72.5%) in the country.

As of the beginning of December, agricultural organizations sowed winter grains for the harvest-2011 throughout the areas of 11.1 mln ha, down 17.8% compared to the previous year.

Ukrainian Grain Association to initiate extra measures for country grain market saving

Ukrainian Grain Association stated that the new Tax Codex coming into force, and also imposition of the mechanism for grain export quotas selling at the auctions will cause damages for the domestic agricultural commodities producers at the level of 350 USD for each cultivated ha of agricultural land. Due to the fact, the Ukrainian Grain Association initiates the extraordinary measures, in order to escape the negative scenario of the situation development on the country grain market and irretrievable damages, stated announcements of the Ukrainian Grains Association signed by Vladimir Klimenko, the President of the Association.

According to the Ukrainian Grain Association, the agrarians losses will be provoked by three reasons. In particular, the VAT refund cancellation for grain exporters (in accordance with the new Tax Codex) will cause damages for grain producers at the level of 400 UAH for each tonne.

Besides, the agrarians will suffer damages at the level of about 250 UAH for each tonne of grains, due to the planned grain export quotas selling at the auctions.

The different varieties of additional payments during export trading will cause the losses at the level of about 120 UAH for each grains tonne.

Thus, according to calculations of the Ukrainian Grain Association, the final losses of agrarians will total about 100 USD for every tonne of grains or about 350 UAH for each ha of cultivated land areas.

The scenario may cause grain production damages in Ukraine, food safety challenge of the country and the foreign markets lose, noted the Ukrainian Grain Association in its announcement. Meanwhile, the Association reminds that the European Union dotations for 1 ha of treated land total the level of about 500 EUR.

Due to the fact, the Ukrainian Grain Association brings up the range of the principal issues for the agricultural complex for which it would like to get the answers, in particular, who will be responsible for ruination of peasants, due to the changes in the VAT taxation?

Besides, the Ukrainian Grain Association brings up the issue about: why representatives of the non-governmental organizations were excluded from the composition of the commission for grain export quotas distribution of the Ministry of Agrarian Policy and Food of Ukraine?

The Ukrainian Grain Association is also wondered: in accordance with what order the quotas were distributed, if the Agrarian Department did not confirm grain availability at five world known companies, as a result they were not able to introduce the required documents to the Ministry of Economy, and did not receive allowance for exports of any tonne of grains? According to the conjunction, these five enterprises are the largest borrowers of the European Bank of Reconstruction and Development.

There are other issues of the Association: why the Decree about grain quotas volumes increase and about their validity terms prolongation still was not officially introduced? Why maize export limitations were not canceled, though maize production volumes totaled the highest level for all the years of Ukrainian independence.

The Ukrainian Grain Association appealed to the agrarian unions of the country and the Cabinet of Ministers of Ukraine to realize the extra meeting regarding the situation on the grain market for approved decisions making, in order to escape the negative scenario.

UGA predicts heavy losses of farmers due to tax code

The entry into force of the tax code, as well as the introduction of a mechanism of sale of quotas on grain exports at auctions will lead to losses of domestic agricultural producers in the amount of USD 350 for each hectare of land being cultivated by them, the Ukrainian Grain Association (UGA) said in a statement signed by its president, Volodymyr Klymenko.

According to UGA, the losses of farmers will be triggered by three reasons. In particular, the abolition of VAT refunds to grain exporters (in accordance with the new tax code) will lead to losses of grain producers of up to 400 UAH/ton (USD 1 - UAH 7.96).

In addition, the farmers will suffer another UAH 250 per ton of grain due to the planned introduction of the mechanism of sale of quotas on grain exports at the auction.

Various types of additional payments in export operations will lead to losses of another some UAH 120 per ton of grain.

Thus, UGA says, the resulting losses of farmers will total about USD 100 per ton or USD 350 per hectare of cultivated land.

In this regard, the Ukrainian Grain Association has called on the agricultural associations of the country and the Cabinet of Ministers to hold an extraordinary meeting on the situation in the grain market for making agreed solutions to avoid the development of a negative scenario.

The Verkhovna Rada adopted the new tax code, as amended by President Viktor Yanukovych, on December 2. The document will come into force on January 1, 2011.

Ukraine. 93% of winter crops in good and satisfactory condition

Winter crops in Ukraine were in good condition on an area of 4.5 million hectares as of December 16, 2010, which was 55.3% of the total area under crops, according to the Ukrainian Agriculture and Food Ministry. Crops on an area of 3.11 million hectares were in satisfactory condition, or 38.1% of the total area.

Weak sprouts were reported on an area of 543,000 hectares, or 6.6% of the total area.

Winter wheat was in good condition on 3.74 million hectares (56.5%), satisfactory condition on 2.46 million hectares (37.1%), and weak sprouts were recorded on an area of 418,000 hectares (6.3%).

Winter barley was in good condition on 540,000 hectares (44.4%), satisfactory condition on 560,000 hectares (45.5%), and weak sprouts were reported on an area of 123,000 hectares (10%).

Winter rye was in good and satisfactory condition on 218,000 hectares (70%) and 83,600 hectares (27%) respectively.

As of December 16, winter rapeseed was in good condition on 53.5% of the area, satisfactory condition on 35.8% of the area, and weak sprouts were reported on 10.7% of the area.

Russia plans to prolong grain export ban after July 1, 2011

Russia will possibly prolong the grain export ban after July 1, 2011, if the country does not produce over 70 mln tonnes of grains next year, stated Arkadiy Zlochevskiy, the Head of Russian Grain Union, on December 20.

Russia sowed winter crops throughout the areas of 15.5 mln ha for the harvest-2011, as opposed to 18 mln ha a year ago. The Government is willing to increase spring crops sowing areas in order to compensate the decrease. However, there are certain problems with fertilizers, stated A.Zlochevskiy.

According to him, agricultural producers should increase fertilizers stocks in January, in order to be ready for the spring field works, otherwise the country will fall the sowing campaign.

Agricultural producers stock about 3 mln tonnes of grains, except of 60.5 mln tonnes of the officially harvested volumes, however it will not effect the essential impact on the market, due to the fact that the grain volumes are mostly stocked in the regions, where the production volumes level exceeds consumption.

A.Zlochevskiy forecasts that grain imports to Russia in 2010/11 MY will total 3-3.5 mln tonnes. The main import volumes is expected from the direction of Ukraine and Kazakhstan, however it is possible to purchase rye from Germany and barley from France.

Russia - Using grain stocks

Russia may be forced to expedite grain imports and sales from state stockpiles to ease “tight” supply in drought-hit regions, SovEcon said.

“Massive imports as well as intervention sales may ease the tension,” the Moscow-based researcher said on its website today. The government may be forced to start sales from 9.64 million metric-ton stockpiles earlier than planned, SovEcon said. Sales could begin in March, according to the country’s Agriculture Ministry.

Russia, which lost 38 percent of its grain crop in this year’s drought and banned exports through July 1, is facing difficulties delivering surplus grain from seven regions in the south and Siberia to the drought-hit areas, SovEcon said. Feed- grain supply is “particularly” tight... 

GAFTA expects for improvement of work on the grain market of Ukraine

The Grain and Feed Trade Association (GAFTA) hopes for improvement of work on the grain market of Ukraine next year at the expense of establishment of the clear and predictable rules of its functioning, stated Anna Golodova, the Director of the Office of GAFTA in Ukraine, on December 16.

According to the Director, the situation on the grain market of Ukraine in the current marketing year causes concern to the world grain public.

Vladimir Klimenko, the President of Ukrainian Grain Association, also hopes that problems of grain exports from Ukraine will be solved in accordance with civilized rules, and the country will supply grains volumes on the foreign markets, provided by balances.

According to him, since the beginning of the current MY Ukraine exported about 0.8 mln tonnes of maize and 2.1 mln tonnes of barley and wheat.

V.Klimenko noted that to date grain export trading from Ukraine is realized in accordance with the previously issued licenses, which are valid till December 31, 2010. At the same time, he doubts that grain traders will be able to export quoted grains volumes before January 1, 2011.

The President of Ukrainian Grain Association also announced that the new Tax Codex provides VAT refund cancellation for grain exporters. According to him, it will cause grain purchasing prices decrease from July 1, 2011, by 20%. He is assured that the VAT refund for grain exporters is necessary to be saved, due to the fact that the norm cancellation may cause the essential grain production profitability slump and grain production volumes decrease in the country.

Ukraine sowed winter crops throughout 9.25 mln ha

Ukrainian agricultural enterprises of all categories sowed winter crops throughout the areas of 9.258 mln ha for the harvest-2011, down 8.1% compared to the previous year results, declared the State Statistics Committee of Ukraine on December 15.

In particular, Ukraine sowed winter grains throughout the areas of 8.088 mln ha, a decrease of 5.5% compared to the previous year. Winter wheat sowing areas totaled 6.55 mln ha, rye – 287.8 thsd ha, barley – 1.246 mln ha.

Besides, winter rapeseed sowing areas occupied 1.082 mln ha, down 23.7% compared to indices of the last year.

In 2010, Ukraine to produce over 1.5 mln tonnes of soybean

In 2010, the growth of soybean sowing areas in Ukraine totaled 46% compared to 2009 results. The general soybean production in the country totaled over 1.5 mln tonnes, declared the press-cutting service of SHP Niva Ltd.

In Ukraine, the average yield index of the oilseed totaled 18.9 c/ha at matching fields, where mineral nitrogen fertilizers, chemical protectants and fungicides were used, in southern oblasts (irrigated areas) – 23.7 c/ha.

At the same time, during growing of soybean with usage of biological preparations, the oilseed yield increases by one third, and reaches the average level of 26.4 c/ha in Ukraine, and 34.6 c/ha at irrigated areas in southern oblasts of Ukraine.

Ukraine to impose zero VAT rate for grain operations in the first half of 2011 In 2011 from January 1 till July 1, the Government imposed zero VAT rate for export operations with grains, sunflower seed and rapeseed. The credit balance deficit of the VAT (value added tax) will be refunded due to the export presence during the period, stated Sergey Stoyanov, the General Director of Ukrainian Agrarian Confederation. “But with the certain new features, stated by the art.200 of the new Tax Codex”, specified S.Stoyanov. At the same time, the General Director of Ukrainian Grain Company noted that for dealers, who used to purchase the above stated crops from the producers and used to sell them to the processors and/ or to the exporters, the business life is finished. Due to the fact that standard about the VAT non-taxation operations with grains, sunflower and rapeseed, besides their first sell by agricultural producers, will come into force on January 1, 2011. The dealers, if they do not plan in the first half of 2011 to export the previously purchased volumes, should sell the crops remainders during the last days of 2010, noted S.Stoyanov. Argentina - Russia orders 3 million tons of Argentine animal-feed corn Russia is interested in purchasing 3 million tons of Argentine animal feed corn to supply its domestic market following the catastrophic drought and fires suffered by the country during summer months in the northern hemisphere. The request was made official to Argentina’s International Trade and Economic Relations Secretary Luis Maria Kreckler currently in Moscow as head of a trade and investment delegation. This would be Russia’s major purchase of Argentine corn since the eighties. The Argentine delegation is in Russia promoting the sale of food industry goods with added value and a high technology component as part of the country’s policy to diversify markets. Argentina and the former Soviet Union were close trade partners during the Cold War, particularly the last military Junta that in 1980 helped break the grains embargo imposed by the Jimmy Carter administration on the USSR. Kreckler said that the first shipment of corn totalling 300.000 tons should be leaving Argentina next January and a second shipment should be ready for March. “Russian operators are involved in negotiations with Argentine companies so as to complete the full needs of the market”, said Kreckler. The Argentine Ministry of Agriculture, Livestock and Fisheries and the Animal and the Plant & Health Office, Senasa are updating the records on free exports of transgenic grains to Russia and inviting the largest number of exporters to join the corn operation. The Argentine delegation met with the Deputy Foreign Affairs minister Serguey Ryabkov and the president of the Russian-Argentina joint committee Serguey Dankvert, among other officials form the Agriculture and Economic Development ministries. Argentine delegates said Buenos Aires the country is very much interested in diversifying markets and attracting Russian investment. Argentina is interested in Russia’s participation in the construction of thermo-electric plants in the north of the country involving over a billion US dollars investment. The negotiations are seen as the result of the strategic association consolidated during President Cristina Fernandez de Kirchner visit to Russia in 2008 and President Dimitri Medvedev reciprocating trip to Argentina last year. Kreckler also reiterated Argentina’s support for Russia’s incorporation to the World Trade organization. “We’re most satisfied that a strategic associate of Argentina as Russia will finally become a full member and participate in WTO debates”, said Kreckler. The Argentine Agriculture ministry estimate for the current corn harvest is a record 26 million tons covering four million hectares. The US Department of Agriculture estimate is 25 million tons. Regarding wheat the estimate for the current 2010/11 crop is 12.5 million tons, half a million more than in October. USDA latest estimate was 13.5 million tons while the Buenos Aires Cereals Exchange, 12.7 million tons. Climate conditions have been very good both for corn and wheat so far. Meanwhile the Rosario Stock exchange announced that the 2010/2011 soy bean crop in Argentina will reach 49.5 million tons, this is because of a major participation of soy in the two crops. Apparently 30% of the 18.7 million hectares to be planted have been completed, which should be a new record. The Argentine government has estimated the current 2010/11 soy crop in 52 million tons and 18.7 million hectares, just below the 52.7 million tons and 18.65 million hectares of the 2009/10 harvest.

Ukraine: quotas prolongation to effect the domestic market negatively

According to various experts, grain export quotas prolongation by the Government of Ukraine till March 31, 2011, will have the negative circumstances for the domestic grain market.

It may happen that Ukrainian agrarians will start sowing sunflower, soybean and rapeseed, which are not under the state regulation, due to the fact they are not able to sell grains due to the imposed limitations, stated Vladimir Klimenko, the President of Ukrainian Grain Association, on December 10.

V.Klimenko underlined that the Association considers maize export quota regime as unreasonable. Maize quotas should be canceled, stated he.

As about wheat, according to him, in the case of wheat export quotas prolongation, it will be necessary to increase the quotas by few millions tonnes.

When the country exports by 4.8 mln tonnes of maize and wheat each, only then it will become possible to consider the issue of the crops quotas imposition, stated he.

The President of Ukrainian Grains Association noted that to date the market did not face any reaction for the Government decision to prolong grain export quotas. He explained that the volume. by which the quotas were increased. was previously bought by grain traders and does not effect the situation at all.

V.Klimenko also announced that grain traders received licenses for the quotas volumes, distributed on November 12, and to date continue exporting grains.

As it was previously announced, several days ago the Cabinet of Ministers of Ukraine prolonged grains export quota regime till March 31, 2011, and increased quotas volumes till the level of 4.2 mln tonnes. In particular, maize quota was increased by 1 mln tonnes – till the level of 3 mln tonnes, wheat – by 0.5 mln tonnes, till the level of 1 mln tonnes. Barley quotas volumes were not changed – 0.2 mln tonnes.

From October 19 till December 31, 2010, Ukraine imposed grains export quotas at the level of 2.7 mln tonnes, including wheat – 0.5 mln tonnes, barley – 0.2 mln tonnes, maize – 2 mln tonnes, rye and buckwheat – by 1 thsd tonnes each.

On November 12, the specially founded committee distributed 2.182 mln tonnes of quotas between the Ukrainian companies.

Ukraine: 54% of winter crops sowings to face the good conditions

According to data from regions, as of December 9, 2010, winter grain sowings in Ukraine faced good condition throughout 4.42 mln ha, which totaled 54.1% from the general winter grain sowing areas. 3.14 mln ha of winter grain sowings, or 38.4%, faced rather satisfactory condition, marked the Ministry of Agrarian Policy of Ukraine. 615.1 thsd ha (7.6%) of winter crops sowings showed the weak and thinned condition.

Winter wheat showed good condition indices throughout the areas of 3.66 mln ha or 55.2% of the general areas, satisfactory condition – 2.48 mln ha (37.5%), weak and thinned condition – 0.483 mln ha (7.3%). Winter barley showed good condition indices throughout 0.53 mln ha or 43.6% of the areas, satisfactory condition – 0.55 mln ha (45.7%), weak and thinned condition – 0.129 mln ha (10.7%).

Winter rye sowings faced good and satisfactory condition indices throughout 224.7 thsd ha (69.7% of the areas), and 88.7 thsd ha (27.5%), respectively.

As of the reporting date, rapeseed sowing areas faced the good condition throughout 53.5% of the sowings, satisfactory condition – 35.9%, weak and thinned condition – 10.6%.

The general areas of 8.198 mln ha of winter grain sowing areas faced appearance of seedlings throughout 8.17 mln ha.

Ukraine: non-governmental organizations to announce about the necessity of maize export quotas urgent cancellation

According to the non-governmental organizations of the Agricultural Complex of Ukraine, it is necessary to cancel maize export quotas urgently, due to the grain surpluses on the domestic market, stated representatives of the organizations during the press-conference on December 10.

The representatives are totally against the export quotas of maize, stated Leonid Kozachenko, the President of Ukrainian Agrarian Confederation.

According to him, due to maize export limitations, as of November 8, 2010, the price level was lower by 570 UAH/t compared to the level, which could have been with free export trading.

According to the announcement of Nikholay Mirkevich, the President of the Association of farmers and private landowners of Ukraine, to date Ukrainian farmers faced difficulties with maize selling, due to rather low demand. According to him, the situation may cause maize field areas decrease for the harvest-2011.

To date, the price not just fall down, it is the situation, when nobody purchases anything, confirmed Gennadiy Novikov, the Head of the Agrarian Union of Ukraine.

According to his calculations, about 3 mln tonnes of maize need to be exported from the country, otherwise the volumes will press the market. At the same time, agrarians do not have the required resources for sells holding down till appearance of the more profitable price situation.

The experts noted that Ukraine needs to export maize to date, due to the fact that in the spring the world price level will decrease.

Ukraine: Tax Codex to release grain traders from administrating and VAT refund

The changes introduced to the new Tax Codex of Ukraine concerning grains and sunflower seed VAT (Value Added Tax) “finally released Ukrainian grain traders from 15-years horror of administrating and VAT refund in realities of Ukraine ”, stated Sergey Stoyanov, the General Director of Ukrainian Agrarian Confederation.

At the same time, S.Stoyanov noted that all grain producers, without exclusion, who within the terms of the average grain production volumes at the level of 45 mln tonnes (commodity rate totals 80%) will settle for it, by losing about 10 bln UAH annually on the automated, forced by traders, pressed by the foreign market, reduction of grain purchasing prices for the further export trading.

The Government operator will be in the list of the last ones, if the company does not want to become bankrupt during a few months, underlined the General Director of Ukrainian Agrarian Confederation.

Ukraine. Grain export quotas to lower prices on domestic market - expert

Extension of export quotas to 31 March 2011 will lead to reduction of prices for cereals by 15% - 20%. This opinion was expressed by BG Capital analysts.

The Cabinet of Ministers extended the regime of quotas for grain exports by one quarter, from December 30, 2010 to March 31, 2011, with an increase in the size of quotas by 1.5 million tons up to 4.2 million tons, thus strengthening manual control over pricing in the domestic market. The prolongation has brought the Ukrainian government closer to achieving its main goal: to rein in food prices, and will ultimately lead to 15-20% grain price fall by the end of the first quarter of 2011, which, along with the recent innovations in reimbursement of VAT on the export of cereals, will be another 'hit in the pocket' of domestic farmers.

The first attempt to rein in rising prices for grains, taken by the Government in mid-October in the form of the introduction of quotas on exports until the end of the year, was unsuccessful. Farmers preferred to hold the grain until the end of the year, so as to sell out the harvest at market prices after the abolition of quotas. Activity in the market has sharply declined, while the pricing environment has remained almost unchanged.

Now that quotas are extended, Ukrainian farmers will be forced to sell their stocks urgently, since they will be physically unable to hold the volumes of grain until the end of the first quarter of 2011 (elimination of quotas) without significantly reducing its quality and even a loss of some crops, experts say.

Kazakhstan to supply 600-800 thsd tonnes of grains to Iran

Kazakhstan plans to supply about 600-800 thsd tonnes of wheat to Iran, stated Daulet Uvashev, the Managing Director of JSC “Food contract corporation”.

According to him, the Iranian market is still unavailable for Kazakh grain traders, due to rather high taxes for wheat imports, in order to protect the domestic market.

Due to imposition of the high level of duties and taxes at the level of 50%, the Kazakh price is noncompetitive. That is why, Kazakh traders expect, when Iran applies to Kazakhstan for wheat supply, because the country has already canceled limitations for barley imports.

However, in 3-4 months the country will be able to remove the reporting limitations. Last year, Kazakhstan exported about 1.1-1.2 mln tonnes of wheat to Iran.

As is was previously announced, in the summer 2009 Kazakhstan in cooperation with Iran launched grain terminal in the port Amirabad, which should provide to Kazakhstan to realize grain export trading to Iran and the countries of the Persian region. Production capacity of the terminal is 700 thsd tonnes of grains.

Ukraine extended grain export quotas set until 31.03.2011. Under quotas may be exported 3 mio mt of corn, 1 mio mt of wheat and 200k mt of barley.

KIEV, Dec 6 (Reuters) - Ukraine's Economy Ministry   proposed the government extend grain export quotas set to expire on December 31 to March 31 next year, according to a draft resolution published on Monday. The draft resolution proposed issuing additional quotas for exports of 500,000 tonnes of wheat exports and 1.0 million of maize. The initial grain export quotas allow exports of 500,000 tonnes of wheat and 2.0 million of maize until the year-end.

Ukraine: ports to continue grain shipment

According to data of the monitoring of APK-Inform Agency, to date the Ukrainian ports actively continue to realize grains and by-products loadings in accordance to the personnel arrangements.

Thus, for example during the last week Illichevsk port shipped 34.5 thsd tonnes of wheat, and over 48 thsd tonnes of maize. Odessa Commercial Sea Port port continued maize shipment works. Also, the ports continue the active loading of oilseeds and sunflower oil.

According to the market operators, the delays during the loadings really exist, but they appear due to the errors in the documents, introduced for the commodities licensing and can be removed during the few days.

As of the current moment there are no artificially delayed vessels in the Ukrainian ports. All the export operations are being realized in time, as a result the country gets grains and oilseeds, and also by-products stable export trading.

As a reminder, previously Leonid Kozachenko, the President of Ukrainian Agrarian Confederation, announced that grains export trading is still blocked, due to the fact that the Ministry of Economy does not issue the licenses to grain trading enterprises. According to his data, the situation caused grain volumes accumulation in the ports at the level of 183 thsd tonnes.

As of December 3, Ukraine completed soybean harvesting campaign

According to operative data, as of December 3, 2010, Ukrainian agrarians harvested 41.48 mln tonnes of grains throughout the areas of 14.57 mln ha, which totaled 99.7% of the planned areas. The average yield of grains and leguminous plants totaled 28.5 c/ha.

In particular, Ukrainian agrarians produced 12.05 mln tonnes of maize throughout the areas of 2.62 mln ha (99% of the forecast). The average yield of the crop totaled 45.9 c/ha.

Besides, as of the reporting date, Ukrainian agricultural enterprises harvested soybean throughout 1.038 mln ha (100% of the forecast). The production volumes totaled 1.671 mln tonnes with the average yield of 16.1 c/ha.

Ukraine: 55% of winter crops sowings to face the good conditions

According to data from regions, as of December 2, 2010, winter grain sowings in Ukraine faced good condition throughout nearly 4.45 mln ha, which totaled 54.6% from the general winter grain sowing areas. 3.08 mln ha of winter grain sowings, or 37.8%, faced rather satisfactory condition, marked the Ministry of Agrarian Policy of Ukraine. 615.8 thsd ha (7.6%) of winter crops sowings showed the weak and thinned condition.

Winter wheat showed good condition indices throughout the areas of 3.7 mln ha or 56% of the general areas, satisfactory condition – 2.43 mln ha (36.7%), weak and thinned condition – 0.48 mln ha (7.3%). Winter barley showed good condition indices throughout 0.51 mln ha or 42.3% of the areas, satisfactory condition – 0.56 mln ha (46.9%), weak and thinned condition – 0.13 mln ha (10.8%).

Winter rye sowings faced good and satisfactory condition indices throughout 224 thsd ha (69.4% of the areas), and 89.3 thsd ha (27.6%), respectively.

As of the reporting date, rapeseed sowing areas faced the good condition throughout 53.4% of the sowings, satisfactory condition – 36%, weak and thinned condition – 10.6%.

The general areas of 8.2 mln ha of winter grain sowing areas faced appearance of seedlings throughout 8.15 mln ha of the sowing areas.