October 3, 2011
The Ukrainian government forecast to harvest 54.3 million tonnes of grain next year, the highest figure since Ukraine gained independence and two million tonnes above the previous record registered in 1991.
Market participants are skeptical about the planned record announced a year beforehand. Doubts arise about the accuracy of forecasts for a crop that has not even been planted yet.
Instead, experts noted that a bearish trend may appear in Ukraine's grain crop in view of this season's difficult conditions for the agricultural market operation and tax novelties in the agricultural sector.
According to a statement issued by the Ukrainian Grain Association (UGA), a logical consequence of the fall in grain exports will be a fall in grain production. "Taking into account that last year's profitability of grains was the lowest in the crop growing sector, the effect of the export duties will be a decline in wheat, barley and corn production," UGA representatives said.
Farmers themselves deny any intention to reduce planted acreage, though continue calling the current working conditions extremely difficult.