Ukraine to possibly increase grain export quotas

The Government of Ukraine will possibly increase quotas for grain exports by 1 mln tonnes – for wheat, and by 1.7 mln tonnes – for maize, and then cancel the quotas imposition after March 2011, declared Nikholay Prysiazhnyuk, the Minister of Agrarian Policy and Food of Ukraine, on January 26.

To date, the Ministry of Economy works out the project of the future Decree, which will be completely formed in February or till the end of March 2011. The Minister of Agrarian Policy added that his department will try to cancel quotas, due to approaching of the new harvesting campaign beginning and coming of new grains on the market.

Ukraine imposed grains export quotas till March 31, 2011. The Russian Federation has existing grain export ban from August 15, 2010, till July 1, 2011.

Grains export quotas, imposed by the Government of Ukraine in the beginning of October 2010 till December 31, 2010, were prolonged till March 31, 2011. At the same time, the total volume was increased by 1.5 mln tonnes – till the level of 4.2 mln tonnes. Maize export quota was increased from 2 to 3 mln tonnes, wheat – from 0.5 till 1 mln tonnes.

Ukraine: Ministry of Agrarian Policy forecasts grain exports at the level of 13 mln tonnes

On January 27, Nikholay Prysiazhnyuk, the Minister of Agrarian Policy and Food of Ukraine, declared that in the current marketing year Ukraine will supply nearly 13 mln tonnes of grains on foreign markets.

According to him, Ukraine will export directly the same volume of grains, which is expected by the world organizations, and domestic statistic estimations.

Vladimir Klimenko, the President of the Ukrainian Grain Association, informed that from the beginning of the current MY Ukraine exported nearly 7 mln tonnes of grains, including 0.3 mln tonnes in 2011 only. According to him, the low export indices in the beginning of 2011 are caused by the fact that the Government started issuing export licenses for additional quota volumes, given for the period of January 1 – March 31, just recently.

Russia, Ukraine and Kazakhstan to come back to grain pool creation idea

The Russian Federation, Ukraine and Kazakhstan may come back to the idea of creation of the grain pool, in order to cheapen grain delivery to the countries-buyers.

At first, the idea was announced on the World Grain Forum in St.Petersburg in June 2009. However, the reporting countries did not arrange real actions after that.

Nikholay Prysiazhnyuk, the Head of the Ministry of Agrarian Policy of Ukraine, returned to the idea, while answering the presentation of Saktash Hasenov, the Deputy Ministry of Agriculture of Kazakhstan, during the Forum “Agriculture and Food industry development in the East Europe and Central Asia”, which was within the International exhibition “Green week 2011” on January 21, in Berlin.

S.Hasenov complained that Kazakhstan, being one of the largest grains suppliers, wheat first of all, feels dependence upon Ukraine and Russia, due to the necessity to use their ports for grain supplies.

Due to the fact, exporters had to expand own export geography and start to supply grains to other directions, in particular to the South-East Asia and Iran. In order to realize the project, the country started building new railway through Uzbekistan, at the border with China the country will build large grains terminal, and started also realization of other projects. According to him, China, the Republic of Korea face the interest in Kazakh grains.

N.Prysiazhnyuk noted that due to the fact, it is reasonably for three countries – Russia, Ukraine, and Kazakhstan – to found the grain pool, in order to decrease logistics costs. Then there will be the opportunity to make replacement within the country and have cheap logistics, in order to sell cheap grains to countries-buyers.

While talking about the prospects of participating of Ukraine in the Customs Union, N.Prysiazhnyuk noted that the Government does not consider the issue at all.

As it was previously announced, to date there is active grain export ban in Russia (till July 1, 2011), and Ukraine imposed grain export quotas till March 31, 2011.

Ukraine. Food grains corporation to plan to cultivate over 100 thsd ha of land areas

The State enterprise “State Food Grains Corporation of Ukraine ” plans to form land bank at the volume of over 100 thsd ha, stated Alexander Lavrinchuk, the General Director of the State enterprise “State Food Grains Corporation of Ukraine ”.

The Director noted that 5 enterprises, which are in the process of entering the corporation, treat about 10 thsd of ploughing lands. At the same time, there is an active work for agricultural lands widening.

A.Lavrinchuk specified that to date there is the process of the corporation foundation, filling by the assets. According to him, on January 20-21, the first 36 enterprises will enter the corporation as the branches, which previously were under the sphere of control of the Government Stocks Company “Khleb Ukrainy”.

The Head of the Government enterprise “State Food Grains Corporation of Ukraine ” noted that the capacities of assigning of enterprises to the authorized capital of the Corporation are estimated at the level of 3 mln tonnes of simultaneous grains and oilseeds stocking, of grains shipment – about 2.5 mln tonnes annually. At the same time, the Corporation plans to increase shipment capacities of port elevators till the level of 5 mln tonnes, to increase the capacities of linear elevators for grains stocking till the level of 4.5 mln tonnes.

He also announced that there is the Project of the Decree of the Cabinet of Ministers about assigning for managing by the corporation of additionally 13 enterprises of the Government Stocks Company “Khleb Ukrainy”.

As it was previously announced, in August 2010 the Government of Ukraine accepted the decision to found the Government Enterprise “State Food Grains Corporation of Ukraine ”. According to it, the Government Stock Company “Khleb Ukrainy” should assign 36 elevators, centers of grain production and grain stores, including Odessa and Nikolayev port elevators, to the founding enterprise.

WARNING! BELOW DECREE OF GOVERNMENT ABLE TO STOP ALL GRAIN EXPORT FROM UKRAINE FOR SOME DAYS/WEEKS STARTING FROM 01.02.2011!

Ukraine: Decree on signing and registration of foreign economic contracts at the Agrarian exchange to come into force on February 1

In Ukraine from February 1, 2011, the Decree of the Cabinet of Ministers of Ukraine about signing and registration of Foreign Economic contracts will come into force. The corresponding Decree of the Cabinet of Ministers #1254 dd. December 13, 2010, is published at the web-site of the Government.

In particular, according to the document, the services for signing and registration of Foreign Economic contracts for agricultural commodities (products) exports are provided by the Agrarian exchange or other commodities exchanges, which are certified in the stated order regarding to the standards of selling or supplying of exchange commodities and to which the Agrarian exchange entitled to participate in the exchange trade.

Customs clearance of the exported commodities is being provided on the base of Foreign Economic contracts, signed and registered at the Agrarian exchange or other certified commodities exchanges, except of Foreign Economic contracts, signed and registered before the current Decree comes into force. At the same time, the demands are not extended on the products exports as humanitarian international help and the stocks, intended for consumption, noted in the art. 115 of the Customs Codex of Ukraine.

The Ministry of Agrarian Policy and Food was ordered before January 15, 2011, to approve the order of signing and registration of Foreign Economic contracts at the Agrarian exchange.

Besides, the Ministry of Agrarian Policy and Food, the State Custom Service in cooperation with the Agrarian exchange were ordered by January 20, 2011, to develop the mechanism of providing the State Customs Service with electronic copies of the certificates of registration of Foreign Economic contracts for commodities exports, verified by the electronic digital signs.

Ukraine: agrarian block of the Government was not successful in making quotas receiving procedure clear

Ukrainian agricultural producers share own view with the position of Nikholay Azarov, the Prime-Minister of Ukraine, about the necessity of grain export quotas cancellation, which was announced by the Head of the Government at the end of December 2010. The quotas imposition played the role in stabilization of food domestic market, however to date the special export regime is the essential brake for agrarian development of the country. The opinion was stated by Eugene Leng, the General Director of Ukrzernoprom Agro Ltd., stated the press-service of the enterprise.

Grain free exports absence causes the essential losses for Ukrainian agrarians. The general sum totals 10 bln UAH.

In the conditions of the absence of funds for the rural area development in the state budget, it is the hard impact on the peasants interests. Besides, the plant growing commodities demand faced the essential decrease. It causes agricultural enterprises financial rates worsening, commodities overstocking. Vagueness with the possibility to realize fruits of own labor without limitations caused the fact that agrarians essentially decreased winter crops field. The quotas keeping will cause more essential decrease of wheat, barley, maize spring sowing areas. The bank sector of Ukraine, in the conditions of financial rates decrease at the agricultural producers and unpredictability of the export policy for the next season, turns aside of the agrarian industry. It will mean very violent funds deficit increase, necessary for fields work realization, stated E.Leng.

According to his opinion, the agrarian block of the Government did not make quotas receiving procedure clear and controlled by the professional industry associations. Ukrainian mass media announces about the essential corruption component, laid into the procedure. Additional export quotas allocation for intergovernmental agreements implementation is the direct frustration of the antimonopoly legislation, and causes the disparity of market participants and comes in conflict with the principles, which Ukraine should have followed, when received the status of the country with market economics.

To date, agrarians do not even discuss the reasonability of the quotas regime imposition with grain production volumes at the level of 40 mln tonnes, underlined E.Leng. Of course, it causes the serious doubts. But it is about the fact that if the country continues the current policy – it is the discrimination of all the peasantry, which may cause not only the serious circumstances for economics of Ukraine, which condition is not still the best after the economic crisis, but also effects at grain production decrease in the current season. It is based on the support of agricultural workers of the position of Nikholay Azarov, the Prime-Minister of Ukraine, who stated about the necessity of the export quotas cancellation at the end of December.

Ukraine: wheat export quotas are distributed among 15 enterprises

On January 11, 2011, the Ministry of Economic Development and Trade of Ukraine provided meeting of the Commission on the issue of consideration of applications for export licenses issuance of certain varieties of agricultural commodities and the quotas distribution, stated the press-service of the Ministry of Economic Development on January 12.

According to the results of the Commission meeting, it was realized the proportional distribution of the quotas in accordance with the received applications and in accordance with stated order.

Thus, wheat export quotas at the volume of 500 thsd tonnes (quota ratio – 0.92) was distributed between 15 enterprises. The company Khleb Investbud Ltd. received the quota for exports of over 221.34 thsd tonnes of wheat, Kernel-Trade Ltd. – 46.112 thsd tonnes, Volars Export Ltd. – 31.356 thsd tonnes.

Maize export quotas were distributed at the level of 1.518 mln tonnes (quota ratio – 0.905). The quotas were distributed between 26 enterprises. Khleb Investbud Ltd. received the largest quota volume (543.9 thsd tonnes).

Quotas threaten 'collapse' in Ukraine grain output

by AgriMoney The head of one of Ukraine's major farm operators has warned of a potential "collapse" in the country's grains production if it does not repeal quotas which could cost farmers up to $1.3bn. Eugene Leng, the chief executive of Ukrzernoprom Agro warned that a fall in sowings of winter crops would herald an even greater drop in spring plantings unless the government lifts the quotas which are denying farmers the full benefit of high world crop prices. Mr Leng - a former journalist who helped set up Ukrzernoprom Agro 10 years ago, and who was decorated for his services to farming by Ukraine's former president, Victor Yushchenko – conceded that the export curbs had "played a role in stabilising the domestic food market". However, the quotas, which have been extended until the end of March, were a "major impediment" to farmers, who were also facing a dearth of subsidy support and, in with their finances deteriorating, growing difficulty in obtaining loans from banks. 'Significant losses' "The absence of free grain exports is causing significant losses to farmers," Mr Leng said, estimating the losses could reach 10bn hryvnia, ($1.3bn). "With no funds available for villages in the state budget, rural residents are dealt a heavy blow." He attributed a fall in winter sowings, estimated by UkrAgroConsult on Tuesday at 3.0% for wheat and 24% for both barley and rapeseed, to "confusion" among farmers over their prospects. "If quotas remain intact then there will be even greater reduction in spring wheat, barley and maize [corn]," Mr Leng said, adding that they threatened a "collapse of grain production this season". 'Deficit of working capital' The comments follow a warning from UkrAgroConsult itself about farmers' shortage of cash, saying they faced a "deficit of working capital" which could "seriously hamper growing operations in spring and summer". Limitations on many farms' ability to afford higher priced fertilizers and agrichemicals "will substantially reduce the grain yield potential of both winter and spring crops", the influential analysis group added. However, it highlighted the late arrival of rains to break last summer's drought as a reason for the drop in autumn seedings, denying many farms adequate soil moisture until well after the optimum planting period had passed. And, despite its reservations, UkrAgroConsult forecast Ukraine's total grains harvest rebounding by nearly 18% to 46.2m tonnes this year, including a 22% rise to 21.0m tonnes in wheat production. Quotas handed out Ukraine's parliament last month approved the extension of export quotas until the end of March, adding a further 1m tonnes of corn and 500,000 tonnes of wheat to permitted shipments. Earlier this week, Ukraine said that it had distributed this extra wheat export quota among 15 companies, with Khleb Investbud recieving the lion's share, at more than 221,000 tonnes, Kernel being awarded 46,100 tonnes and Volary 31,400 tonnes. Ukrzernoprom Agro, whose holding company MCB Agricole is listed in Frankfurt, farms some 100,000 hectares, with barley, rapeseed, sunflowers and wheat its biggest crops.

Ukraine: Commission of the Ministry of Economic Development and Trade distributed grain export quotas in January-March, 2011

During the meeting on January 11, 2011, the Commission of the Ministry of Economic Development and Trade of Ukraine completely distributed quotas for grain exports from the territory of the country among Ukrainian enterprises-exporters, stated the Press-service of the Ukrainian Agrarian Confederation.

According to Sergey Stoyanov, the General Director of the Ukrainian Agrarian Confederation, during the voting the representative of the Ukrainian Agrarian Confederation did not vote, due to the fact that other Commission members did not support the offer to prolong applications acceptance by the Ministry of Economic Development and Trade till January 14, due to the fact that the range of the enterprises were not able to receive the conclusion issued by the Ministry of Agrarian Policy and Food during the period of January 4-6, which confirms that the entrepreneur has the agricultural products volume, stated in the application, and till the end of the working day of January 6, to introduce applications for quotas receiving.

At the same time (and it is stated in the protocol of the Commission session), it is probably will be resort for the “rejected ones” the fact that during the nearest days there will be introduced the offer to the Government for additional grain export quotas distribution, almost all surplus carry-over stocks.

According to data of the Ukrainian Agrarian Confederation, the surplus (excluding just distributed volumes) is estimated at the level of 5 mln tonnes, meanwhile as of 01.07.2011 grain carry-over stocks will also total the level of 5 mln tonnes, which is almost at the level of 01.07.2010 carry-over stocks. And it is without taking into account the possible incoming on the balance of 2010/11 MY till July 1, 2011, of grain harvest-2011 (barley and wheat). During the last years so pre-schedule volumes form the level of 1-1.5 mln tonnes, stated Sergey Stoyanov, the General Director of the Ukrainian Agrarian Confederation.

Ukraine exported 6.7 mln tonnes of grains

From the beginning of the current MY, Ukraine exported 6.7 mln tonnes of grains, including 1.5 mln tonnes – within frames of the imposed export quotas, declared Alexander Demidov, the Director of the department of plant growing markets of the Ministry of Agrarian Policy and Food, on January 11.

According to him, in particular maize exports from Ukraine in 2010/11 MY totaled 1 mln tonnes.

A.Demidov informed that to date export-oriented companies organize grains export trading according to the licenses, provided before January 1, 2011.

At the same time, he noted that to date the Government works out preparations for distribution of the quotas for exports of grains, prolonged till March 31, 2011.

In 2010, Ukraine produced 39.3 mln tonnes of grains in clean weight

In 2010, Ukraine produced 39.3 mln tonnes of grains and leguminous plants in clean weight, as opposed to 46 mln tonnes in 2009, declared Alexander Demidov, the Director of the department of plant growing markets of the Ministry of Agrarian Policy and Food, on January 11.

According to him, the Ministry considers such harvest results as rather positive indices.

According to A.Demidov, taking into account the plans of the regions to keep spring crops sowing areas at the previous year level, and the current conditions of winter crops sowing areas, in 2011 Ukraine will be able to produce nearly 45 mln tonnes of grains. The index corresponds to the average harvesting results in Ukraine during the previous 5-6 years.

Ukraine: grain processing to be the priority unlike of grain exports

Grain processing operations inside the country is the priority for Ukraine unlike of grain export trading, stated Nikolay Azarov, the Prime-Minister of Ukraine.

According to him, it is necessary to realize grain processing operations on the domestic market in accordance with the long-term interests of the country and organize the domestic consumption, and export abroad just only certain volumes of grains. It all has to be the long-term policy of Ukraine, underlined the Head of the Government.

Ukraine not to activate high-grade flour sales to Indonesia

According to information of the representative of the Limited Liability Company “Kombinat khliboproduktiv “Talne”, the Ukrainian enterprises, which received the permission for high-grade flour exports to Indonesia (certificate SNI) at the end of 2010, still did not start flour sales at the stated direction.

Just only “Kombinat khliboproduktiv “Talnoe” Ltd. shipped flour volumes to the country. At the same time, first-grade flour, used by Indonesia for poultry and prawn feed, and which does not need SNI certificate, was exported by Ukrtranscontact Ltd..

As a result, during December 2010 high-grade flour export volumes to Indonesia from Ukraine totaled 1598 tonnes at the price of 300 USD/t FCA, and also 1-grade flour – 484 tonnes at the price of 275 USD/t FCA.

Ukraine not to change grain prices

On January 10, Anatoliy Rozgon, the Director of the Department of development of the agrarian market of Ukraine of the Ministry of Agrarian Policy and Food, stated that the country reached prices stabilization owing to the measures, which the Government introduced last year. Generally, due to the fact that the situation was not new for the market, the Government was getting ready, and grain export limitation was the first step, according to him.

At the same time, according to A.Rozgon, on the world market grain prices increased to the level of 300 USD/t, during the certain time Ukraine traced the situation, however to date the grain prices face the stable level and vary within the limits of 200-220 USD/t on the domestic market.

Meanwhile, A.Rozgon underlined that due to the fact that Ukrainian market is export dependable, the factors forming prices on the foreign markets will have the direct influence also on price formation on the domestic market. First of all the factor will influence at grains, oilseeds, vegetable oils prices, in particular rapeseed oil, which price increased by 45% during 2010, and in Ukraine by 35%.

The tendency will also have the continuation in the current year. That is why, vegetable oil market is in the zone of the close attention, noted A.Rozgon, and added that during 10 days of 2011 oil prices increased by 5%.

According to him, the price increase was caused by the demand increase, and now it is expected for the prices stabilization, due to the sufficient oil volumes on the market.

Kazakhstan produced 12.2 mln tonnes of grains

According to data of the the Agency of Statistics of the Republic of Kazakhstan, in 2010 grain production in Kazakhstan totaled 12.2 mln tonnes in clean weight, declared Akylbek Kurishbayev, the Minister of Agriculture.

Last year the country exported 8.8 mln tonnes of grains, including 4.2 mln tonnes of the harvest-2010, explained A.Kurishbayev.

According to the preliminary data, in 2010 the general grain production in bunker weight totaled 13.9 mln tonnes. In 2009, grain production in Kazakhstan totaled 22.7 mln tonnes in bunker weight, and 20 mln tonnes in clean weight.

Ministry of Economy of Ukraine to accept applications for receiving of grain export licenses till January 7

The Ministry of Economic Development and Trade of Ukraine will complete accepting of applications for the further distribution of licenses for exports of agricultural products according to the additional quotas, acting till March 31, 2011, on January 7, 2011. The corresponding announcement was promulgated at the web-site of the Ministry.

According to the announcement, the Ministry stared accepting the applications on December 31, 2010, and the terms of the applications acceptance totals 7 days, in accordance with the new rules.

As a reminder, the Cabinet of Ministers of Ukraine prolonged the term of the quota regime for grain exports till the end of March 2011.

Agriculture ministry: 93.6% of winter crops in Ukraine in good and satisfactory condition

Winter grain crops covering an area of 4.52 million hectares in Ukraine, or 56% of the crop area, were in a good condition as of December 29, 2010, and those of three million hectares (37.6%) were in a satisfactory condition, the Agriculture Ministry has told Interfax-Ukraine, with reference to information provided by the regions.

Winter grain crops on 530,000 hectares, or 6.5% of the crop area, were weak and thinned.

In particular, winter wheat sprouted on an area of 6.55 million hectares, 57.1% of which was in a good condition, 36.6% of the crops were in a satisfactory condition, and 6.3% were weak and thinned.

As of December 29, winter rape on 53.3% of the crop area was in a good condition, on 38.4% in a satisfactory condition, and on 8.3% weak and thinned.

According to preliminary data from the State Statistics Committee, Ukraine sowed almost 9.3 million hectares with green fodder and grain in 2010, which is 9.1% down year-over-year. According to the report, winter crop fields this year were reduced by 5.5%, to 8.088 million hectares.