Ukraine’s Wheat Harvest Seen Dropping Most in Five Years

20.04.2017

A fertilizer shortage and dry weather may reduce Ukraine’s wheat crop by the most in five years. While wheat is still developing ahead of the summer harvest, there are signs of smaller yields, analysts attending the Black Sea Grain Conference in Kiev said last week. Researcher UkrAgroConsult predicts the 2017-18 crop may fall about 7 percent to 24.2 million metric tons and Nibulon SA trader Volodymyr Slavinsky said it could drop to as low as 23 million tons if conditions don’t improve.

While there’s plenty of time for conditions to change and farmers should still collect a substantial amount, supplies are set to fall for a second year after a series of bigger harvests that helped transform Ukraine into one of the world’s top exporters. On top of a lack of rain, growers are facing a short supply of nutrients. Two major plants halted nitrogen fertilizer output last month after losing their gas supply, the Ukrainian Club of Agriculture Business said.

“The fertilizer deficit that has emerged in the market may result in significant losses in agricultural production, losses of foreign-exchange earnings and a serious crisis in agriculture,” the lobby group said in a statement last month. UkrLandFarming, one of the largest Ukrainian agriculture companies, said growers are receiving fertilizer with a delay of two to three weeks, and that could lead to lower wheatproduction. There’s a “certain shortage” of nutrients, said Victor Spassky, head of the company’s crop unit.

After being unchanged for more than a month, Ukrainian wheat-export prices this week rose to the highest since May. They added 0.3 percent to $188.50 a ton as of Thursday, according to UkrAgroConsult.

Wheat hasn’t been the only commodity affected by the fertilizer shortage. Plants sown in the spring, such as corn and sunflowers, will suffer without the extra nutrients, according to consultant ProAgro in Kiev.

Wheat was planted in the autumn and probably received more nutrients at the time and after coming out of dormancy this year, said Dmitry Lutsyk, head of the analytical department at ProAgro. By comparison, corn planting is due to start next week -- in middle of the fertilizer shortage.

Still, UkrLandFarming’s Spassky said he’s hopeful the situation will change in the coming months, and another big harvest is expected as long as there’s favorable weather. Winter conditions killed the smallest-ever share of crops planted in autumn, Maxim Martyniuk, Ukraine’s first deputy agriculture minister, said on Facebook.

“If there are regular rains, everything should be all right,” Spassky said.

 

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