Ukraine corn to reach record high, wheat, barley to decrease

Marketing Year 2012/13 may well be called the year of corn in Ukraine. This crop has been gaining popularity in the country in the last several years and is now expected to produce another record of about 23 Million Metric Tons (MMT), compared to 22 MMT a year prior.

This increase in production of corn is mostly attributed to the need to replant large areas of lost or damaged wheat and barley due to winter kill or dry weather, and to some favorable market conditions that were created for corn sales both domestically in Ukraine and globally.

Wheat and barley production in MY 2012/13 is projected to decline, by about 40 per cent and roughly 20 per cent, respectively, mainly due to unusually high winter kill and anticipated lower than average yields.

Wheat and barley fall plantings were affected by dryness. Up to 1.2 million hectares (Mln ha) of all winter plantings (about 12 per cent) were considered by the Ministry of Agrarian Policy and Food of Ukraine (MinAg) to not have even emerged in the fall of 2011. The majority of the rest of the winter crops did not develop strong plants to enter into the winter season.

In addition, already weaker than usual plants were subjected to extensive periods of very low temperatures. A mixture of factors like weak and underdeveloped plants and a lack of or inadequate snow cover in some cases resulted in dramatic spring field pictures. In Southern and Eastern Ukraine experts estimated up to 60 per cent winter barley loses.

Rye production continues on the general downward trend and is also expected to be affected by winter crop losses. Grain trade in MY 2012/13 is expected to favor corn because of high beginning stocks and high projected production.

Bioethanol production is once again up for consideration in the GOU and may well pass the first reading at the Rada (Parliament) if corn production keeps its pace and the investment in bioethanol production industry becomes available for Ukraine.