Review of Ukrainian grain market

Ukraine is one of the leading countries supplying agricultural products to the world market. 42 million hectares of fertile land our country are optimal for agricultural plantations.

In the international market cereals sector, Ukraine is one of the leading niche with enormous agricultural potential, the disposal of which are high-quality black soil, the proximity of water sources, and high-quality workforce.

The location of our country there are all the ingredients for the effective and efficient development of the sector of cereals, unfolding its potential and dynamic growth of the market of consumption, but little deterrent transition to a new qualitative level of development of the sector of the agricultural market of Ukraine is the lack of funding.

Strategic advantage in global agricultural sector is the relatively low cost of grain production and sufficiently available logistics. According to the State Statistics Service of Ukraine in the agricultural sector last year Ukraine was drawn about 27 billion hryvnia investment.

The most active investors in the agricultural sector of Ukraine are considered to be large and medium-sized agricultural holdings, owning land bank of more than 10 thousand ha, as well as the European Bank for Reconstruction and Development and International Finance Corporation. Last year, the European Bank for Reconstruction and Development invested in the agricultural sector of Ukraine 180 million euros, and the International Finance Corporation has invested in a variety of agricultural projects of about US $ 200 million.

Ukraine geographically favorably located in six climatic zones, which contributes to the cultivation of all kinds of grain and harvest sufficient for both domestic needs and the formation of export potential of grain crops. By formed as a recent trend towards consolidation of agriculture and the growth of powerful agro-industrial complexes, the positive changes taking place in the agricultural sector: the growth of levels of use of modern agricultural techniques, the use of innovative plant protection, strategic approach to the formation of structures and methods of cultivation of cereal. All these activities ultimately lead to a reduction in the impact of weather conditions on the volume and quality of the grain harvest.

The main shaft production capacity of cereals market consists of three crops: wheat, barley and maize. Also, these three major cereal crops occupy most of the volume of export of grain from Ukraine. The main exporters of Ukrainian grain serve both Ukrainian and international companies ( “Nibulon”, “Kernel”, “Louis Dreyfus Ukraine Ltd”, “Cargill”, “Serna”, “Bunge Ukraine” and others). Ukraine is stable exports about 50% of the grain harvest in the marketing year, therefore, the international grain market plays an important role in the direction of the grain of cultural development in our country.

According to the Ministry of Agrarian Policy of Ukraine since the beginning of 2016/17 Ukraine exported 29.43 million tons of grain, which is 2.42 million tons more than the same period last season.

In particular, as of the reporting date, Ukrainian agrarians exported 13.56 million tons of wheat, which is 1.72 million tons more than in the same period of the previous marketing year.

Exports of barley amounted to 4.66 million tons, which is 0.7 mln. tons more than the same period last season.

The volume of exports of maize during the reporting period amounted to 11.05 million tons which is 0.07 million tons more than the same period of 2015/16 MY.