Highlights

Ukraine has completed planting grains for the 2017 spring campaign. Weather conditions featuring low levels of soil moisture and frost in some regions have created conditions for lower-than-expected yields in general. Post estimates that total grain production for Marketing Year (MY) 2017/18 will fall below the record levels achieved over the last few MYs. Ukraine remains an active grain exporter, with wheat and barley exports already reaching record levels for MY2016/17. Exporters continue to diversify their market destinations. This is particularly notable for exports of corn and wheat flour, where there is a decreasing reliance on a small number of large buyers.

Ukrainian farmers have planted: 177 thousand hectares (ha) of spring wheat, 1.5 million ha of spring barley, and 4.5 million ha of corn as of June 13, 2017. These areas combined with winter grains planted areas, as reported by the State Statistics Service of Ukraine (SSSU) at the end of 2016 as well as available information about planting areas on the Crimean Peninsula (217 thousand ha of barley, 294 thousand ha of wheat and 2.5 thousand ha of corn), form the basis for estimated production areas for individual grain crops reflected in USDA’s Production, Supply and Distribution (PSD) data.

Trade

Bumper production volumes in 2016 for all major grains (except for rye) translated into increased export volumes. Ukraine exported 17.3 million metric tons (MMT) of wheat; 20.1 MMT of corn; 5, 3 MMT of barley; 7.6 thousand metric tons (MT) of rye and 368 thousand MT of wheat flour for local MY2016/17 (July 2016-June 2017 for all mentioned crops) as of 21 June, 2017. It is notable that exports of wheat, barley, and wheat flour hit record marks.

For July 2016-March 2017, wheat exports grew by 13 percent compared to the same period of the previous MY. Wheat exports have been diversified by shipping over one third of total exportable volume to South Asia (predominantly India and Bangladesh) while reducing volumes shipped to the EU by nearly one half.

Wheat flour exports grew by 15 percent for July 2016-March 2017, compared to the same period of the previous MY.A major change among export destinations occurred as a result of the 5.5-fold increase of exports to Africa at the expense of a 40-percent decrease of exports to traditional buyers in East and Southeast Asia -- predominantly China, North Korea and South Korea. An interesting feature of Ukrainian exports to Africa is that they have shipped to a half a dozen countries across the continent with volumes varying widely -- from 23 thousand MT to Somalia, down to only 48 MT to Chad. This is likely a sign that Ukrainian flour producers are targeting the African market to increase future market share.

For July 2016-March 2017, barley exports grew by almost 21 percent compared to the same period of the previous MY. The major driver behind this growth was a 2.7-fold increase in exports to Africa -- mainly the countries of Libya, Algeria and Tunisia.

Corn exports grew by almost 13 percent between October 2016-March 2017, compared to the same period of the previous MY. Ukrainian exporters lost their positions in East and Southeast Asia after a decrease in demand from the Chinese market -- down to 286 thousand MT from 1.7 MMT the same period of the previous MY. This amount was practically redirected to South Korea, Vietnam, and Japan. Another factor supporting corn exports was a boost of shipments to the Middle East -- mainly to Iran, which bought almost 2 MMT, compared to 113 thousand MT for the same period of the previous MY.

Consumption

Post has further decreased wheat and rye food consumption for MY2016/17 against the previous estimate, based on ever-decreasing volumes of bread production in the country . Despite decreasing bread volumes, wheat flour production for MY2016/17 remains stable supported by growing exports of this commodity.

The decrease of bread production for MY2016/17 resulted in cuts to FSI consumption for wheat and rye. These two crops are mainly intended for food consumption, particularly milling and baking.

Rye feed consumption levels have been kept at a minimum for MY2016/17 on the grounds that only a small fraction of this crop is used for feed purposes. Post maintains the same level for MY2017/18 as estimated production volumes would not likely sustain increased feed consumption of this crop. Growth of rye feed consumption could only happen under an unlikely scenario involving a drop in its FSI consumption due to drastic changes in consumption patterns of the local population.

General animal numbers in the country: a 9.3-percent decrease in pig numbers and a 1.4-percent increase for poultry for December-May 2017. The economic situation in the country does not suggest increased consumption of products of animal origin in 2017. Moreover, reports of the local Veterinary Service on outbreaks of African Swine Fever suggest a further decrease of pig herd sizes in 2017. Based in these assumptions, Post decreased the country’s total feed consumption by around 5 percent for MY2016/17 compared to MY2015/16, and another 3 percent for MY2017/18 compared to MY2016/17.

Stocks

Ending stocks for all grains at the end of MY2016/17 showed traditional depletion to minimal levels due to active exports of corn, wheat and barley. Rye stocks hit new lows caused by decreasing production of this crop for two consecutive MYs in a row. Wheat stocks were lower than usual due to active exports of both wheat and flour for MY2016/17

Production, Supply and Distribution Data

Estimated wheat flour, pasta, and bakery exports/imports have been added to export volumes for wheat -- in wheat grain equivalent, calculated by multiplying the product weight by 1.368. Grain production numbers include Crimean Peninsula production numbers.

Barley:

Post’s production estimate is 24 percent higher than USDA’s official data for MY2017/18, based on higher yield estimates. This revision leads to increased Post numbers compared to USDA’s official data for: exports by 17 percent; feed and residual consumption by 26 percent; and FSI consumption by 7 percent.

Post’s export estimate is 3 percent lower than USDA’s official data for MY2016/17, based on available import data.

Post’s Feed and Residual estimates are 7 percent higher than USDA’s official data for MY2016/17, due to low volumes of wheat available for this purpose resulting from active exports. Post’s FSI estimates are also 7 percent higher than USDA’s official data for MY2016/17, based on stable demand from domestic processors.

Corn:

Post’s production estimate is 11 percent lower than USDA’s official data for MY2017/18, based on lower yield estimates. This revision leads to decreased Post numbers compared to USDA’s official data for exports by 12 percent, and Feed and Residual consumption by 14 percent, for MY2017/18. Post’s import estimate is revised 30 percent lower and Post’s export estimate is revised 6 percent higher than USDA’s official data for MY2016/17, based on available trade data.

Rye:

Post’s production estimate is 6 percent lower than USDA’s official data for MY2017/18, based on lower yield estimates. Post’s export estimate is 20 percent lower than USDA’s official data for MY2016/17, based on available export data. Post’s Feed and Residual estimates are 80 percent lower than USDA’s official data both for MY2016/17 and MY2017/18.

Wheat

2015/2016

2016/2017

2017/2018

Market Begin Year

Jul 2015

Jul 2016

Jul 2017

Ukraine

USDA Official

New

Post

USDA Official

New

Post

USDA Official

New

Post

Area Harvested

7115

7110

6450

6463

6600

6578

Beginning Stocks

5678

5678

3348

3303

2083

1987

Production

27274

27332

26800

26854

25000

25250

MY Imports

27

24

35

30

25

28

TY Imports

27

24

35

30

25

28

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

32979

33034

30183

30187

27108

27265

MY Exports

17431

17431

17800

17800

14500

14500

TY Exports

17431

17431

17800

17800

14500

14500

Feed and Residual

5100

5200

3600

3700

3900

4000

FSI Consumption

7100

7100

6700

6700

6700

6700

Total Consumption

12200

12300

10300

10400

10600

10700

Ending Stocks

3348

3303

2083

1987

2008

2065

Total Distribution

32979

33034

30183

30187

27108

27265

Yield

3.83333.84424.1554.1553.78793.8386

Corn

Corn

2015/2016

2016/2017

2017/2018

Market Begin Year

Oct 2015

Oct 2016

Oct 2017

Ukraine

USDA Official

New

Post

USDA Official

New

Post

USDA Official

New

Post

Area Harvested

408540844250

4252

4400

4483

Beginning Stocks

1819

1819

585

1383

1235

1193

Production

23333

23330

28000

28075

28500

25300

MY Imports

28

29

50

35

25

30

TY Imports

28

29

50

35

25

30

TY Imp. from U.S.

0

1

0

0

0

0

Total Supply

25180

25178

28635

29493

29760

26523

MY Exports

16595

16595

19000

20200

20500

18100

TY Exports

16595

16595

19000

20200

20500

18100

Feed and Residual

6600

5800

7000

6700

6900

5900

FSI Consumption

1400

1400

1400

1400

1400

1400

Total Consumption

8000

7200

8400

8100

8300

7300

Ending Stocks

585

1383

1235

1193

960

1123

Total Distribution

25180

25178

28635

29493

29760

26523

Yield

5.71195.71256.58826.60286.47735.6435

Barley

Barley

2015/2016

2016/2017

2017/2018

Market Begin Year

Jul 2015

Jul 2016

Jul 2017

Ukraine

USDA Official

New

Post

USDA Official

New

Post

USDA Official

New

Post

Area Harvested

3000

2997

3050

3054

2600

2684

Beginning Stocks

1265

1265

909

747

914

693

Production

8751

8788

9900

9938

7400

9200

MY Imports

5

6

5

8

5

6

TY Imports

5

6

5

8

5

6

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

10021

10059

10814

10693

8319

9899

MY Exports

4412

4412

5500

5300

3600

4200

TY Exports

4673

4673

5500

5200

3600

4200

Feed and Residual

3200

3400

3000

3200

2700

3400

FSI Consumption

1500

1500

1400

1500

1400

1500

Total Consumption

4700

4900

4400

4700

4100

4900

Ending Stocks

909

747

914

693

619

799

Total Distribution

10021

10059

10814

10693

8319

9899

Yield

2.917

2.9323

3.2459

3.2541

2.8462

3.4277

Rey

Rye

2015/2016

2016/2017

2017/2018

Market Begin Year

Jul 2015

Jul 2016

Jul 2017

Ukraine

USDA Official

New

Post

USDA Official

New

Post

USDA Official

New

Post

Area Harvested

152

151

144

144

170

169

Beginning Stocks

106

106

75

70

75

54

Production

394

391

390

392

450

423

MY Imports

16

15

0

2

0

1

TY Imports

16

16

0

2

0

1

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

516

512

465

464

525

478

MY Exports

21

20

10

8

10

10

TY Exports

21

20

10

8

10

10

Feed and Residual

20

2

10

2

10

2

FSI Consumption

400

420

370

400

450

400

Total Consumption

420

422

380

402

460

402

Ending Stocks

75

70

75

54

55

66

Total Distribution

516

512

465

464

525

478

Yield

2.59212.58942.70832.72222.6471

2.503