Ukraine. Soybean margin as a constraining factor in 2018/19 season


The outlook for the next 2018/19 season prompts us to discuss again soybean production profitability, which increased from 1.3% to 52% in 2008-2016, though being unstable.

In general, soybean cultivation costs and domestic purchase prices have followed an upward trend since 2008. At the same time, the 2015-2017 level of costs stayed above the average, while 2017 prices, on the contrary, sank under the pressure of global soybean market trends.

As a reminder, the Agrarian Economics Institute estimated that soybean production margin would be down almost by half at 25.4% in 2017. UkrAgroConsult has already stated that, combined with tax novelties, this would undermine farmers’ interest in growing soybeans.

The 2018 planting season is fast approaching, and the development/stagnation (underline as appropriate) vector of the Ukrainian soybean market will depend on both lawmakers and growers themselves.

Full version of the article is available to subscribers for weekly market reports “Black Sea Vegoils” by UkrAgroConsult.



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