The MY 2022/23, total grain production in Ukraine is estimated at 40-52 MMT. Grain exports in the next season may appear to be higher at 40-50 MMT due to unprecedentedly high ending stocks of 2021/22 season and intensely expected renewal of export shipments thru the Black Sea ports. 

Sergey Feofilov
Director General
UkrAgroConsult

Since the situation is changing daily, UkrAgroConsult team developed three scenarios for grain production-2022.**

WHEAT

The pessimistic scenario provides a harvesting area reduction in the regions of hostilities (in each region the decline differs depending on the intensity of the military actions)

Optimistic one relies on a quick cease fire and war end with growing inputs (incl.fuel) and equipment supply at the optimum time for sowing.

Medium/basic scenario is in-between of the mentioned above and UkrAgroConsult considers it as the most likely.

For all scenarios, yield decline is assumed, since agri technologies application will suffer due to deficit of fuel and finances;

The main areas of winter wheat cultivation, incl. Zaporizhzhia, Odesa, and Kharkiv regions, fall into the area of hostilities. Yields will be determined by technology, full scale application of which now looks questionable.

Ukraine faced in Feb and March a deficit of precipitation:

• less than 50% of the normal in Center and East of Ukraine
• in the western regions from 50 to 80% of the normal.

In the coming days a cyclone with significant precipitation will come to Ukraine, which should improve soil moisture considerably;

According to our medium/basic scenario, wheat production-2022 in Ukraine will be 19.8 M mt, exports estimations are at 14-16 MMT, quite high due to unprecedentedly high ending stocks of the 2021/22 season;

BARLEY

Winter barley situation is similar to wheat. However, yield may decline not so significantly as barley cultivation less depends on technology application. Besides, winter barley areas are mainly in the Odesa and Mykolaiv areas with not so sufficient military risks;

By April 7th, 551 K ha of spring barley out of scheduled 1036.5 K ha were planted (53% of the intentions, the Ministry of Agricultural Policy reported). Moreover, the planting rates exceed last year's in Zakarpattia, Volyn, Lviv, Rivne, Ternopil, Khmelnytsky, Sumy, Odesa and Kirovohrad regions;

According to UkrAgroConsult basic scenario, total barley harvest-2022 in Ukraine is estimated between 6.1 and 7 M mt, exports – 3-3.8 M mt;

CORN

Forecasts of Corn production-2022 are the most variable compared to other cereals. Firstly, a significant corn area falls in regions with active hostilities. Secondly, corn is the most technological crop, requiring a sufficient input application.

Besides that, export and domestic prices decline might possibly lead to a reduction in sowing areas.

According to UkrAgroConsult medium/basic scenario corn crop-2022 in Ukraine can be between 19 and 24 M mt with export potential being at 19-26 M mt due to high carryover stocks.

OILSEEDS AND VEGETABLE OILS MARKETS

Key topics at the moment:

• outlook of 2021/22 exports, the current domestic market price trends and estimated domestic stocks;
• 2022 spring planting campaign and harvest prospects;
• Logistics issues.

SUMMARY

Under high risks, when ag markets may change very quickly and unexpectedly, UkrAgroConsult offers you optimistic, pessimistic and medium scenarios. We suggest you to take a medium one as a basis now, which predicts the following oilseed harvests:

• SFS – 10.5-12.0 M mt vs. 16.5 M mt last year;
• soybeans – 2.9 M mt vs. 3.5 M mt;
• rapeseed – 2.9 M mt vs. 3.1 M mt last year.

Ukraine plays a significant role in world food markets, remaining the top sunflower oil  supplier and accounting for almost half of SFO total exports worldwide.

Military actions adjust the 2021/22 season export potential. With no access to the Blacksea ports, the shipments are kept by land transport. This will promote formation of significant ending stocks this season.

According to UkrAgroConsult estimates, the following volumes of exportable stocks might be not shipped to foreign markets:

• SFO – 3.0-3.4 M mt;
• SFS - 40 K mt;
• soybeans – 600-800 K mt.

Currently making the 2022 planting campaign successful is one of the top priorities. As of April 7, 2022, plantings started all across Ukraine with rates being ahead of last year:

• sunflower - 108.1 K ha (75.5 K ha y/y);
• soybeans - 14.1 K ha (not started yet by this date last year);
• spring rapeseed - 11.6 K ha (not started yet by this date last year).

SUNFLOWER AND SUNFLOWER OIL

UkrAgroConsult assessment for the 2022/23 season:

• Sunflower areas might go down seriously;
• Sunflower oil exports will recover due to high sunseed opening stocks of the 2022/23 if the Black Sea ports renew their activity.

SOYBEANS

UkrAgroConsult does not expect soybean area shrink significantly as almost all soy fields are located in areas of low war risk. Moreover, soy areas might grow in western Ukraine, which hosts most soybean processing facilities, with soybeans and soybean meal traditionally highly demanded by the EU markets.

RAPESEED

Record large winter rapeseed areas for 2022 crop were sown in the autumn 2021. About 98% of rapeseed areas in Ukraine are winter varieties. Much of rapeseed plantings are in good conditions after wintering with minimal losses. The harvested area might  decrease because roughly 300 K ha are in the high risk regions. However, the rapeseed 2022 production will be at least at its three-year average level, and traditionally aimed to export to the EU markets.

* The estimates in the article are based on ‘Black Sea Grain. Conflicting S&D’ webinar held by UkrAgroConsult on April 6,2022. 

**All numbers and assumptions currently reported are actual for short time as the market trends may change quickly and unpredictably.