August 8, 2011

Russia curbs Ukraine's grain export

Active export of Russian grain at very low prices has resulted in low export of Ukrainian grain, Dragon Capital senior analyst Tamara Levchenko said.

There are preliminary data on export. This is about 400,000 tonnes. Very low volumes due to large volumes of Russian grain coming to the market," she notes.

According to the expert, Russia tries to return lost consumers and cuts prices following suspension of operation of a ban for grain export since July 1.

In addition, Levchenko predicts, in the current season, Ukraine and Russia will offer about 40 million tonnes of grain for exports, whereas over the season of 2010/2011 (July-June) Russia exported four million tonnes (till introduction of a ban since August 15), while Ukraine - about 13 million tonnes.

According to Dragon Capital estimates, in August, grain export from Ukraine will make up about 0.8-1 million tonnes, further, the volume can increase to 1.7-1.8 million tonnes in H1, 2011/2012 and two million tonnes - in H2, in total, the export forecast makes up 21-22 million tonnes.

According to Ukrainian Agrarian Confederation, in June, grain export from Ukraine reduced 3.9 fold against June to 380,000 tonnes. Including, 160,000 tonnes of wheat was exported, 40,000 tonnes of corn and about 170,000 tonnes of barley.

Since July 1, Ukraine abolished grain export quotas, which were introduced in autumn 2010 due to the poor yield. Instead of quotas, a 9-14% duty was introduced for grain export till 2012.