“This season’s combined export potential of Russia and Ukraine is up 5% year-on-year, at almost 100 MMT. At the same time, Ukraine will step up export of wheat, Russia will increase that of corn, while both countries feature a substantial rise in their exportable supplies of barley.”
Turkey is one of the most important destinations for grain deliveries from Russia and Ukraine. In July-October 2019, Turkey absorbed 23% of Russian export grains and 6% of Ukrainian ones. The active development of the Turkish livestock sector fuels growth in demand for coarse grains.
In October, Turkey purchased a record monthly volume of Ukrainian barley (199 KMT), and thereby pushed aside its top importers – the EU, Saudi Arabia and China. Such a rush can be explained by the desire to replenish stocks in advance, while sufficient supply at an attractive price is available in the world market.
Ukraine has exported a total 206 KMT of barley to Turkey this season. It was just in 2014 when Turkey bought that much last time. Apart from barley, Turkey actively imported corn and wheat this season.
In the Turkish market, Russian grains successfully compete with their counterparts from Ukraine. Obviously, Turkey intensified purchases of all grains in the beginning of MY 2019/20. Overall, Turkish importers will likely buy more feed crops this season than they did in MY 2018/19.
Noteworthy is that this season’s combined export potential of Russia and Ukraine is up 5% year-on-year, at almost 100 MMT. At the same time, Ukraine will step up export of wheat, Russia will increase that of corn, while both countries feature a substantial rise in their exportable supplies of barley.
An important point for realizing the region’s export potential is logistics, which was the weakest link in the grain chain just a year ago. The improvement of the situation is evident now. Traders in Ukraine are buying grain carriers. The private fleet of grain carriers has doubled in 2019, and thereby the acute shortage of grain cars has been overcome. The segment of river transportation also boasts achievements: the volume of grain shipped by river vessels has almost doubled against 2018. The main problem faced by Ukrainian logistics now is poor performance of rail transportation, which is declining due to a shortage of locomotives.
Russian shipments will be maintained by the development of port terminals. In Russian Black Sea ports, there are major projects for building new facilities and upgrading existing terminals.
Russia increased the planted area of winter crops for 2020 by 3%. This suggests that grain production and exportable supplies will continue increasing in case of favorable weather and price conditions.
JOIN US TO GAIN INSIGHT INTO BLACK SEA GRAIN MARKET
We invite you to learn more about production and export prospects for Black Sea grains at 17th International Conference “BLACK SEA GRAIN-2020”, which will be held by UkrAgroConsult on April 22-23, 2020 in Kyiv, Ukraine.
‘Black Sea Grain’ Conference is a recognized marketplace and a major annual meeting point for the top agribusiness community. It is a large communication platform, providing 2 days of exclusive agri market insights from leading industry experts, coverage of the global macroeconomic and regional trends, long term forecasts on commodities market, effective networking and face to face contacts.
Located in the heart of the Black Sea region, the conference annually brings together 700+ agribusiness professionals from 500+ companies and 55+ countries worldwide, serving to adjust business strategies and promote international trade.
Conference participants are represented by Ukrainian and international producers and processors of grains and oilseeds, agri holdings, traders, banks and investment funds, shipping, brokerage, insurance, surveying and law companies, governmental authorities, industrial associations etc. Welcome to Kyiv!