February 27, 2012

 

Ukraine, Kazakhstan to step up grain exports

 

 

Kazakhstan and Ukraine are likely to boost exports of corn and wheat, potentially driving down world prices and posing a threat to the US.

 

The region has dominated wheat exports this marketing year, taking wheat and corn business away from the US. CBOT wheat is down about 2% this year, having shed 18% last year, while CBOT corn is down more than 1% year to date.

 

Kazakhstan's wheat exports in the year to June 2012 are expected to surge 75% from a year ago, while Ukraine's corn exports in the year to September 2013 are seen rising about 15-20% to around 14-15 million tonnes, industry officials said at a gathering in Singapore.

 

"Our corn exports will more than double this year to 12.5 million tonnes and next year we see further growth. It should be around 14-15 million tonnes in 2012-13 (Oct-Sept)," Andrew Druzyaka, an official of the State Food and Grain Corp of Ukraine, told reporters.

 

Ukraine's corn output in the year to September 2012 is expected to rise to 22.8 million tonnes from 11.9 million last year, Druzyaka said, with corn stocks expected to be 4.7 million tonnes by the end of September, versus 1.2 million a year ago.

 

"Global demand is very good and our output has risen. I think the main export will be corn in the coming years."

 

He said Ukraine, a leading European exporter of corn, had exported to seven countries in Asia this marketing year, including Japan which bought 800,000 tonnes.

 

"China is a tough market, we have not sold anything to it but maybe in the future there is opportunity."

 

The State Food and Grain Corporation of Ukraine accounts for 20% of the country's grain exports. It is involved in growing grains, processing and exporting.

 

Wheat exports by Kazakhstan, Central Asia's largest exporter of the grain in 2011-12 are seen at 10.5 million tonnes, up from six million a year ago, a Kazakhstan Food Company official said.

 

Wheat output for 2011-12 is seen at 19 million tonnes, up from 12.5 million a year ago, Zaripov Almaz, director of the privately owned Kazakhstan Food Company, told reporters.

 

The grain harvest in Kazakhstan, a top 10 world wheat exporter, more than doubled last year to 27 million tonnes, the biggest crop since independence from the Soviet Union in 1991.

 

The market is closely watching crop progress in the Black Sea region, where adverse weather in some areas has raised expectations of a cap on exports.

 

Russia helped drive up world wheat prices around the beginning of February, first because of speculation about a duty that would limit exports and then because of concerns that hard frost could damage Black Sea crops.