Monday, 24 April 2017

Monday AM Black Sea agribusiness news

Russian Ministry of Agriculture say the total volume of issued credit resources for seasonal field work rose to 104.76 billion roubles, which is 13.3% more than in the same period last year.

As of April 20, Russia spring sowing stood at 5.8 million hectares or 11% of the forecast.

As of April 21 Ukraine spring sowing stood at 2.8 million hectares or 39% of the forecast.

Dagestan takes second place in Russia for rice production.

Belarusian farmers started planting spring rape for the 2017 harvest with 3,000ha planted so far.

Paris-listed AgroGeneration, which farms about 100,000 hectares in Ukraine, reported full-year (EBITDA) earnings  of €19.4 million for 2016, dipping from €19.9 million in 2015.

Russia’s largest vertically integrated agriculture holding company, Rusagro Group, which farms about 600,000 hectares, reported Q1 results for sugar up 26%, meat up 31%, agriculture up 9% with oil and fat segment down 25 %.

Friday, 21 April 2017

Ukraine's Ministry report cool weather did not affect yield of winter and spring crops

Ukraine’s Ministry of Agriculture report that this week’s cold weather did not significantly affect the yield of winter and spring crops.

Although it's probably too early to tell with certainty and the Ministry admit they haven't actually checked crops yet, but I tend to agree.

It might have hurt winter barley which we noted looked poor on our last crop tour back in March and oilseed rape would be at risk although most of that is grown in west Ukraine and escaped the worst of the weather front.

The Ministry do say there are questions about perennial crops which are in the flowering bud stage such as apricots, cherries and peaches. 

Thursday, 20 April 2017

Russian agribusiness news in brief

Russia’s Minister of Agriculture gave a report on the priorities for agricultural in 2017 which include increasing efficiency of state support, credits for farmers, technical renovation, developing new farm lands, improving rural life, soil cultivation, selection and genetics, and agricultural cooperation.

Russia’s Deputy Minister of Agriculture has highlighted the development of domestic seed production as a priority during a meeting on improving seed variety testing with 55 representatives from the research organisation FGBU Gossortkomissiya.

Russian milk production increased by 1.5% in the first quarter of the year compared to last year and reached 6.41mmt.

Russia’s Minister of Agriculture held a working meeting with the heads of the major oil and fat enterprises during which he said the oil and fat industry is one of the most successful in the Russian agro-industrial complex and that Russia ranks second in the world in terms of export of sunflower oil.

USDA assume 2017 weather will be closer to average than 2016, and forecasts Russia’s 2017 grain and pulses production at 110mmt, a seven percent decrease from the 2016 crop but higher than the previous five-year average of 98mmt.

Cold weather and snow fall on Wednesday stopped field operations across much of central Russia, forecast show temperatures returning to double figures so crops are unlikely to be affected and planting will resume without any significant delay.

As of April 19, Russian spring sowing stood at 5.5 million hectares, or 10.5% of the forecast with planting taking place in all regions, except for Siberian and Ural federal districts.

Is there a fertiliser supply problem in Ukraine?

Back in January this year I posted a blog (here) wondering if Ukraine had inadvertently engineered a fertiliser shortage.

The crux of the issue was should Ukraine delay the introduction of anti-dumping duties on Russian fertiliser until after parliament had passed a bill conferring zero duties on nitrogen fertiliser from other countries.

I signed that blog off by saying it was worth keeping an eye on the story then thought nothing more of it and, as I heard nothing else, assumed the story had resolved itself and the problem had gone away.

Then yesterday I was contacted by someone asking if I could confirm news on a fertiliser shortage in Ukraine as a contact of his in Kharkov had not received an order and the factory had closed.

While it’s not entirely unusual for suppliers in Ukraine to renege of orders (I once had a fertiliser company completely disappear, their office was literally empty when we went back) it did make me think of my January fertiliser shortage blog.

Then this morning, Ukraine’s Ministry of Agriculture announced that Ukrainian farmers are provided with fertiliser for the full range of spring field works with a whole load of statistics to back this up.

But then go on to say that farmers are worried about the shutdown of Ukrainian chemical enterprises as they must make full upfront payments for any nitrogen fertilisers orders and that farmers hoped for a quick recovery of factories to be able complete the contractual obligations to supply fertiliser in full.

Sounds like it’s still worth keeping an eye on this story.

Tuesday, 18 April 2017

USDA March weather summary for Europe and FSU

Near- to above-normal temperatures and precipitation during March sustained good to excellent prospects for winter crops.

The warmth (2-5°C above normal) accelerated winter crops out of dormancy several weeks ahead of normal across northeastern Europe and maintained faster-than-normal development elsewhere.

Widespread showers improved soil moisture for wheat and rapeseed from France and southern Germany into the Balkans following a drier-than-normal winter.

In Spain, dry weather in the north (25-50 percent of normal) contrasted with beneficial rain in the south (locally more than 200 percent of normal), resulting in mixed yield prospects for winter wheat and barley.

Western FSU
During march, conditions were favorable for winter wheat in Russia, while short-term drought developed in central Ukraine.

Mild, wet March weather eased crops out of dormancy in central Russia and promoted earlier-than-normal wheat development in southern portions of the country.

In contrast, pronounced dryness (10-25 percent of normal) further reduced soil moisture for vegetative winter wheat in central and southern Ukraine.

However, the dry weather allowed sowing of spring grains and summer crops to get off to an early start.

Meanwhile, locally more than twice the normal monthly rainfall in western Ukraine and Belarus boosted moisture reserves for spring grains and summer crops.

Eastern FSU
During March, seasonably cold, snowy conditions prevailed in the north while rain and snow boosted moisture supplies for dormant winter wheat in the south.

Central Russia and neighboring portions of northern Kazakhstan remained covered by a deep snowpack for much of the month as seasonal cold (readings occasionally below -20°C) prevailed over the region.

Farther south, rain and snow (100-200 percent of normal) maintained adequate to abundant moisture reserves for dormant to early vegetative winter wheat in Uzbekistan.

Latest USDA weather update for western FSU

Widespread showers maintained or improved prospects for winter wheat.

In the primary winter wheat areas of central and southern Ukraine, a second consecutive week of rain (5- 25 mm) further improved soil moisture for vegetative winter wheat following a protracted dry spell during late winter and early spring.

In southern Russia, moderate to heavy showers (10-30 mm) maintained good to excellent conditions for vegetative winter wheat and kept soils moist for corn and sunflower planting (sown in late April and early May, respectively).

Farther west, 5 to 20 mm of rain maintained good early-season soil moisture for spring grains and summer crops in Moldova, Belarus, and western Ukraine.

Latest USDA weather update for Europe

Warmer-than-normal weather prevailed, with beneficial showers in northeastern Europe contrasting with increasing dryness in western growing areas.

High pressure maintained dry, warm weather (2-8°C above normal) over the western half of the continent.

While the sunny skies promoted spring grain planting as well as winter crop development, short-term dryness (25-50 percent of normal precipitation over the past 30 days) has continued to reduce soil moisture over Spain, France, southeastern England, and western Germany.

The lack of rain is particularly untimely in Spain, where winter grains are approaching or progressing through the reproductive stages of development.

Meanwhile, a series of disturbances produced widespread showers (5-25 mm, locally more) in eastern Germany, Poland, Lithuania, and the northern Balkans, sustaining favorable moisture for vegetative wheat and rapeseed.

Dry weather from Italy into southeastern Europe promoted seasonal fieldwork, including early planting of corn, soybeans, and cotton.

Russia latest spring planting numbers

Russian spring sowing stand at 4.7 million hectares or 9% of the forecast with work underway in all regions except Siberia and the Ural federal districts.

Spring cereals and legumes seeded on an area of 2.8mha or 9% of the target area, including spring wheat on 296,500ha, spring barley on 1.5mha and corn on 403,000ha.

Sunflower plantings stand at 685,000ha or 9.6% of the forecast while soya stands at 17,300ha or 0.8% of the forecast.

There are 526,500ha or 46.6% of the forecast sugar beet planted and in Rostov the first 100ha (0.7% of forecast) of rice has been planted.

Potatoes planted on 31,400ha or 9.3% of the forecast and vegetables 33,300ha or 16.3% of the forecast.

Ukraine latest spring planting numbers

Ukraine has planted 2.6mha of spring crops or 36% of the forecast (7.2mha).

This including early spring grain and legumes sown on an area of 2.2mha or 94% of the forecast 2.4 million hectares and is made up of 155,000ha of spring wheat (86% of forecast); 1.5mha of spring barley (92% of forecast); 192,000ha of oats (93%) and 372,000ha of peas (113%).

Sunflower planting is well underway with 1.3mha or 24% from a forecast 5.4mha planted, corn is just getting underway with 342,000ha or 8% of the forecast 4.5mha, while soya planting has hardly started with 31,000ha or 2% planted thus far.

Sugar beet planting stands at 263,000ha or 90% of the forecast which to my mind seems incredibly early and makes me wonder how much of that crop will bolt and go to seed given we could still see some cold temperatures in April.

Russian banks urged to accelerate concessional loans

Back in January, Russia’s Ministry of Agriculture and the state agricultural bank, Rosselkhozbank, signed an agreement on the implementation of preferential crediting for agricultural enterprises.

Today the First Deputy Minister of Agriculture urged banks and regions to accelerate work on concessional loans.

It appears that banks, which had been approved by the Ministry of Agriculture to participate in the scheme, are taking a long time to consider loan applications and are providing borrowers with an incomplete set of documents to obtain government support.

I'm no finance expert but it sounds to me like banks are, unsurprisingly, not too keen to participate in the Ministry plan lend money at 5% when previously they would have commanded 20-30%.

Black Sea agribusiness news in brief

Russian wheat export prices were flat last week, supported by a 1.6% rise in the rouble against the dollar, according to IKAR.

Last month’s total market year grain exports stood at 27.6mmt, down one million tonnes on the same point last year.  Russian grain exports for April are expected to remain low due to Turkey no longer buying Russian grain because of Russia's unwillingness to lift a ban on Turkish tomatoes.

Ukraine’s Kernel Group is finalising the purchase of the Ukrainian Agrarian Investments holding company.

listed on the Warsaw Stock Exchange, Kernel handles about 7.0mmt of agricultural commodities per year and supplies grain and sunflower oil.  If the deal goes ahead Kernel would become Ukraine’s largest land user with a land bank of 700,000 hectares.

Ukraine has completed applying fertiliser to 7.1mha of winter grains and 872,000ha of winter oilseed rape. Spring cereal planting stand at 2.2mha from an expected 2.4mha while corn, sunflower and soya planting has started across the country.

Meanwhile spring cereals and legumes planting in Russia are reported at 2.8mha with other spring crop planting underway in most regions although the Deputy Minister of Agriculture has reported that climatic conditions in the Volga Federal District has delayed spring field works.

Kazakhstan are also reporting the late arrival of spring in the southern regions has forced farmers to revise the dates of spring field work there. 

Wednesday, 12 April 2017

Ukraine continues to support farming

Ukraine’s Minister of Agriculture, Taras Kutovyi, has presented the year’s results to the Parliamentary Economic Committee with the main achievements including state support, market expansion, land reform and privatization of state enterprises.

"Budget support has increased 15 times - this year is $5.45 billion - and 1% of agricultural production will be directed to support farmers, this program is fixed for 5 years" said Kutovyi.

The Minister said that Ukraine significantly increased foreign trade of agricultural products to $19.6 billion or 26% of the total foreign trade.

Other points noted by the Minister was Ukraine produced 66mmt of grain and that the agricultural sector is the driving force for the economy.

Expect Ukraine to keep producing and exporting more agricultural products.

Latest USDA weather update for western FSU

Dry weather was replaced by welcome showers in western growing areas by the end of the period.

In the primary winter wheat areas of central Ukraine, developing spring drought was abated by late-week showers (10-35 mm).

The rain improved early-season prospects for vegetative winter wheat, though southern and eastern portions of Ukraine were bypassed by the heaviest rain (amounts mostly less than 5 mm).

Farther west, widespread showers (5-30 mm, locally more) sustained adequate to abundant moisture supplies for spring grain and summer crop planting in Moldova, western Ukraine, and Belarus.

In southern Russia, sunny skies during the first half of the period favored the development of vegetative winter wheat, while late-week showers (2-20 mm) kept soils moist for corn and sunflower planting (sown in late April and early May, respectively).

Despite the generally mild spring to date, snow has been slow to melt in the Volga District, with more than 25 cm still on the ground in central and eastern portions of the region.

Latest USDA weather update for Europe

Warmer-than-normal weather prevailed, with beneficial showers in eastern Europe contrasting with renewed dryness in western growing areas.

High pressure centered near the British Isles maintained dry, warm weather (up to 4°C above normal) over the western half of the continent.

While the sunny skies promoted the development of vegetative winter wheat and rapeseed, short-term dryness (25-50 percent of normal precipitation over the past 30 days) has reduced topsoil moisture for crop development from southeastern England and northern France into western Germany.

Farther south, dryness also remained a concern for vegetative to reproductive winter grains in northern Spain, though crop prospects are better in southern portions of the country due to near- to above-normal fall and winter precipitation.

Meanwhile, light showers (3-10 mm) were welcomed in northern Italy, improving topsoil moisture for corn and soybean planting and establishment.

In central and eastern Europe, a series of weak disturbances produced widespread albeit highly variable showers (2-30 mm, locally more) from eastern Germany, Poland, and Lithuania into the Balkans.

The rain improved soil moisture in the upper Danube River Valley and maintained favorable early-season prospects for vegetative wheat and rapeseed elsewhere.

Despite the clouds and showers, weekly average temperatures up to 5°C above normal encouraged a faster-than-normal crop development pace over the eastern half of the continent.

Monday, 10 April 2017

Ukraine crop update

As of April 7, Ukraine had planted the first 4,000 hectares from the planned 1.9mha of soyabeans.

Sugar beet stood at 158kha from the planned 293kha and 348kha of sunflower from the planned 5.4mha

Early grain and leguminous crops are ​​2.0mha from 2.4mha including 134kha of spring wheat from a planned 190kha; 1.4mha of spring barley from 1.7mha and 163kha of oats from 208kha.

Peas stood at 339kha from the planned 276kha which just goes to show the concept of centrally planned cropping is in fact a myth.

Fertiliser has been applied to ​​7.0mha of the forecast 7.1mha of winter cereals and ​​859kha of the forecast 872kha of winter rape.

Friday, 7 April 2017

Ukraine looks to France to understand food markets and pricing

Ukraine’s Ministry of Agrarian Policy and Food met with French experts who shared their experiences in commodity market research, pricing and margins in the food sector.

"It is important to understand all the pricing link [between] fields to store shelves and margins for producers, processors and sellers. This understanding allows you to find a reasonable balance between all market participants and the need to provide affordable and quality food” said Ukraine’s Deputy Minister Elena Kovaleva demonstrating a clear lack of understanding how markets work in the real world.

If the retail price food was determined by the cost of production plus a “reasonable” margin then we wouldn’t have dirt poor farmers going out of business every day of the year or only functioning because of huge state handouts.

I’m not entirely sure the French or any EU country dependent on massive state handouts to subsidies farmers and food production are the best people to talk to when looking for examples of good agri-economic food pricing practice. 

My advice would be to talk to New Zealand, they have some experience of operating an agricultural policy without subsidies; tell them you're interested in buying beef livers and I reckon there'll be a delegation on the first available flight.

The long term solution to food pricing, in my opinion, is to increase the retail price of food and educate people to understand that soil has more value than gold and good food comes at a cost and takes precedent over cigarettes, magazines, booze and the latest ultimately disappointing must have piece of crap technology.

OK, maybe not booze, booze is still made out of food.

Thursday, 6 April 2017

Balkan crop update

Despite low January temperatures in Croatia, winter crops are in good condition with no development issues being reported.

Winter wheat plantings are down with a final wheat area expected at around 100,000 ha with a total production forecast between 0.5 and 0.7mmt with a maximum .2mmt available for export.

Corn plantings are anticipated to produce around 2.0mmt with exports to remain high at around 0.45mmt.

In Serbia last year, the (estimated) 3.0mmt wheat crop was the largest in over twenty years giving weight to the argument that the record Black Sea and Eastern Europe harvest was largely down to the weather as much as government policy.

This year the wheat crop is reported to be 12% or 540,000 hectares smaller than last year producing an expected 2.4mmt so exports will likely be down from 1.5mmt last year to 1.0-1.2mmt this year.

Serbia's corn crop is likely to increase this year on the back of lower wheat plantings and with current good soil moisture conditions the crop should reach 7.0mmt and with 2.8mmt carryover it could once again reach the top ten list of global corn exporters.

Today in Ukraine

Ukraine held an open seminar today on reforming state support, the event was part of an EU project on the implementation of agricultural support in Ukraine. If anyone knows about state support of agriculture it’s the EU.

As if by coincidence, Ukraine’s Ministry of Agrarian Policy announced they have allocated a further $11 million for payment of subsidies to agricultural producers which brings the accumulated total in the subsidy kitty to $217 million.

Also today, Ukraine’s Minister of Agriculture met Saudi Arabia’s Minister of Transport and signed a bilateral protocol aimed at promoting business and cultural partnerships, increasing import-exports, technology exchange and attracting investment.

Ukraine was keen to offer to dairy and meat, flour, confectionery, vegetable oils and organic products to Saudi Arabia while Saudi made a proposal to invest in Ukrainian irrigation and water management projects.

Ukraine’s Ag Ministry report that in the current marketing year they may hold a 12% share in the global grain market and are currently ranked fourth in corn exports, third in barley exports and sixth in wheat.

Might be time to start considering the implications of the EU extending CAP to Ukraine and what that would do to Ukraine production and exports.

Russia to increase grain and milk production by 6% and 3% by 2020

Russia has approved amendments to the state program of agricultural development for 2013 – 2020 which cuts agricultural support from 215 billion roubles this year to 194 billion roubles by 2020. 

At the same time the programme sets the plan to increase grain production from 104mmt this year increasing to 110mmt in 2020 and milk to go from 31.1mmt to 31.9mmt.

That’s an increase of 6% and 3% respectively which looks like a number an accountant would come up with to help balance the budget.

The state program also includes rules for granting and allocating subsidies from the federal budget to the regions and will target the following areas:
  • Provision of decoupled support to crop production;
  • increase productivity in dairy cattle;
  • contribute to the achievement of targets of regional programs for the development of agro-industrial complex;
  • reimbursement of interest on investment loans in the agricultural sector;
  • reimbursement of the direct costs incurred for the creation and modernization of agro-industrial complex, as well as the purchase of machinery and equipment;
  • reimbursement of the cost of interest on loans obtained from Russian credit institutions and loans received in agricultural credit consumer cooperatives.
There seems to be a lot of reimbursements which will go down well with the industry but not entirely sure how that will be funded.

Wednesday, 5 April 2017

Ukraine's grain export infrastructure may get an investment boost

Ukraine’s State Food-Grain Corporation is a step closer to purchasing 500 of the much needed 3,000 grain wagons by the end of 2017. 

The long-term lack of investment in grain handling infrastructure is seen as a bottleneck to the expansion of Ukraine’s agricultural exports which has been compounded recently by a change in the rules reducing road haulage weights. 

As if to reiterate the issue, the New York fund Navigator Principal Investors LLC announced this week that they may invest $100 million in Ukrainian ports and Ukraine’s Prime Minister met with President of Korean Corporation Posco Daewoo during which they discussed investing in a grain port terminal.

It is a long way from a discussion to turning the key but it does illustrate that despite the perceived difficulties of doing business and political uncertainty in Ukraine many do still recognise the potential of agri investment projects.

Latest USDA weather update for western FSU

Favorable showers in Russia contrasted with increasing short-term drought in central Ukraine.

Rain (and wet snow) sustained ample moisture supplies for winter wheat development over most of southern and western Russia.

Precipitation totaled 5 to 30 mm, though amounts were less (1-5 mm) in southwestern portions of the Southern District.

In Ukraine, key wheat areas in central and southern portions of the country remained dry (2 mm or less), increasing concerns over short-term drought; precipitation over the past 60 days has totaled less than 50 percent of normal in many key wheat areas of south-central Ukraine.

In contrast, moisture supplies remained favorable across the western third of Ukraine and neighboring Belarus and Moldova, maintaining favorable conditions for corn and soybean sowing (typically planted in late April and early May).

Likewise, light showers (2-8 mm) in eastern Ukraine sustained moisture reserves for upcoming sunflower planting (first half of May).

Latest USDA weather update for Europe

Dry, warm weather promoted winter crop development as well as seasonal fieldwork over much of the continent.

With soil moisture supplies currently favorable over most major winter crop areas of northern and eastern Europe, sunny skies and above-normal temperatures (4-8°C above normal) favored the development of vegetative wheat and rapeseed from northern France and southeastern England into eastern Europe.

Furthermore, producers were able to plant small grains at a rapid pace, particularly from the Low Countries into the Baltic States.

Likewise, dry conditions over the Mediterranean coastal areas allowed citrus harvesting to gain momentum, while light to moderate showers (2-18 mm) increased topsoil moisture in northern Italy for corn planting.

Farther west, widespread showers (2-20 mm, locally more) over central and western Spain were timely for vegetative to reproductive wheat and barley, while locally more than 20 mm of rain in southwestern France boosted soil moisture for corn and sunflower planting (typically sown during the latter half of April).

US wheat in good post-winter condition

Temperatures were up across most of the United States, allowing fieldwork to progress.

Average temperatures and precipitation levels were above average throughout much of the Nation.

Areas of heavy precipitation were noted in the central Great Plains and lower Mississippi Valley, where some locations recorded more than 100mm of rainfall for the week, although dry conditions persisted in the Southeast.

On April 2, 51% of the 2017 winter wheat crop was reported in good to excellent condition, compared with 59% at the same time last year.

Since autumn, crop conditions have worsened in most of the Great Plains States with decreases in the good to excellent categories reported in Montana and Oklahoma.

Also, Kansas winter wheat condition was rated 43% good to excellent, compared with 52% on November 27, 2016.

We have completed our own independent wheat crop condition assessment for Russia and Ukraine with an initial yield forecast, the report is now available, email for details of how to secure a copy.

Tuesday, 4 April 2017

Russian Ukraine crop reports now available

The first Black Sea Crop Tour of 2017 is done and dusted

During March we drove from Moscow to Odessa to assess the post-winter condition of wheat and to take make a forecast on the 2017 harvest.

Reports are now available which will also give you access to the rest of the seasons planned Black Sea tours.

Drop me a line if you would like to purchase the reports or have any questions about subscribing to our service.

Black Sea Crop Tours - the only independent crop consultancy service operating in the Black Sea region.

Black Sea agribusiness news in brief

As of April 3, Russian planting of early spring crops stood at of 1.1mha or 2.1% of the forecast and was 50,800ha more than last year.

As of March 31, Ukraine had planted 1.2mha of early grain and leguminous crops or 51% of planned area.

Russia’s accumulated fertiliser stocks including carryover from 2016 is up 4% on the corresponding date last year.

Over the first two months of this year, Russian pig production increased by 7.5% compared to the same period last and amounted to 554,200mt.

Ukraine’s State Food and Grain Corporation is holding a roundtable on the problems of grain logistics with the main discussion points including the lack of grain wagons, developing river transport and port logistics.

Ukraine, Moldova and Romania held discussions on improving cooperation on food safety particularly animal disease outbreaks, key aspects of veterinary services and cross-border cooperation.

Ukraine’s Minister of Agriculture has outlined the priorities for agricultural development by 2020 which include land reform, food safety and developing the organic market.

Tuesday, 28 March 2017

Latest USDA weather update for western FSU

Unseasonable warmth lingered over much of the region, with well-placed showers maintaining good to excellent early-season prospects for winter wheat in Russia.

This week’s temperatures averaged 4 to 7°C above normal, continuing a warm trend which began in mid-February; consequently, winter wheat - which broke dormancy up to a month ahead of normal - continued to develop at an accelerated pace.

Precipitation during the period totalled 10 to 30 mm over western Russia, boosting moisture supplies for key wheat-producing areas in southern portions of the Southern District (Krasnodar Krai).

In Ukraine, similar rainfall totals maintained good soil moisture for winter wheat in eastern portions of the country, while light rain (5 mm or less) did little to ease concerns over short-term dryness (25-50 percent of normal over the past 60 days) in central and southern wheat areas.

Latest USDA weather update for Europe

Periods of rain maintained or improved prospects for winter grains and oilseeds over much of the continent.

Across central and eastern Europe, a series of fast-moving disturbances produced widespread showers (5-30 mm) in Germany, Poland, and the northern Balkans.

Consequently, moisture reserves remained adequate to abundant for vegetative winter wheat and rapeseed following near- to above-normal precipitation over the past 60 days.

Despite the occasionally wet weather, temperatures 3 to 5°C above normal (up to 8°C above normal in southeastern Europe) continued to promote faster-than normal crop development.

Farther west, late-week rain improved prospects for reproductive winter grains in Spain (5- 20 mm) and boosted moisture supplies for vegetative wheat and rapeseed in France (10-40 mm, locally more).

The western storminess was accompanied by cooler weather (nighttime readings near or below 0°C), with wet snow reported in parts of Spain.

However, the cold did not have any impact on wheat, barley, or rapeseed.

Unsettled weather (5-25 mm) was also observed in southeastern England, sustaining favorable soil moisture for winter crops.

Dry conditions prevailed over the Mediterranean Coastal areas, promoting citrus harvesting and other seasonal fieldwork.

Thursday, 23 March 2017

Russia's official statement to Turkey

In response to Turkey not imposing a ban on Russian wheat imports (they just don't want to buy any at the moment), the Russian Minister of Agriculture has posted a statement on the ministry website, here's a translation:

Statement of the Ministry of Agriculture of Russia in connection with the possible restriction of Russian agricultural products to Turkey

In recent days, conflicting information is coming from Ankara, related to public statements by representatives of Turkish authorities and experts on restricting the supply of Russian agricultural products to Turkey.

The Ministry of Agriculture of Russia is extremely surprised and disappointed by this position of the Turkish colleagues, since during the last 6 months both sides declared the necessity of normalising bilateral trade relations.

In November 2016, during a meeting with the Minister of Food, Agriculture and Livestock of the Republic of Turkey F. Chelik, we agreed on a phasing-out of restrictions in the mutual trade in agricultural products.

For our part, we have done a lot of work to remove these restrictions. Russia lifted restrictions on imports from Turkey of citrus and stone fruit, onions, cabbage, cloves and other food products. In the future, we planned to continue lifting restrictions on other types of agricultural products important for Turkey. At the same time, the Turkish side did not take any active measures to ensure access of Russian meat and dairy products to the Turkish market.

Ankara's acceptance of such a decision could lead to a complete cessation of imports to Turkey of several names of Russian agricultural products (wheat, corn, unrefined sunflower oil, sunflower meal, beans and rice).

Such actions of Turkey call into question the sincerity of intentions to build strong relationships. We do not accept and reject attempts to exert pressure on Russia in order to open the access of Turkish agricultural products to the Russian market in those sensitive areas where Russian production has been actively developing in recent years.

For our part, we will take all necessary measures to diversify the sales markets. Taking into account Russia's leading positions on the world grain market and the quality of Russian agricultural products, I am confident that we will be able to promptly reorient the supply of Russian agricultural products to other regions of the world in a short time.

I want to assure that we will continue to support Russian producers and exporters, and also maximally protect our own market in sensitive areas of agriculture so that within 5-7 years Russian agricultural producers can fully meet the needs of the domestic market in agricultural products and food.
Minister of Agriculture of the Russian Federation         
A.N. Tkachev

Wednesday, 22 March 2017

USDA February weather summary for western FSU

Conditions for dormant winter wheat were good to excellent over the region during February.

A bitter cold first half of the month had little - if any - impact on winter crops due to widespread deep snow cover.

A pronounced warm up during the latter half of the month rapidly melted the region’s snowpack and accelerated winter wheat out of dormancy in southern portions of Ukraine and Russia.

The sharply contrasting temperature regimes resulted in monthly values near normal, though daytime highs in the teens (degrees C) in southern Russia at the end of February were more typical of readings observed in late March and early April.

Precipitation was favourable in southern Russia (100-200 percent of normal), while drier-than-normal conditions (locally less than 75 percent of normal) developed during February in central Ukraine’s winter wheat areas

USDA February weather summary for eastern FSU

During February, seasonably cold, snowy conditions prevailed in the north while rain and snow boosted moisture supplies for dormant winter wheat in the south.

Central Russia and neighbouring portions of northern Kazakhstan were encased in a deep snowpack as bitter cold (-40 to -30°C) prevailed over the region.

Farther south, moderate to heavy rain and snow (100- 270 percent of normal) maintained adequate to abundant moisture reserves for dormant winter wheat in Uzbekistan.

Ukraine’s Chinese loan will be reduced

Ukraine’s Minister of Agriculture has said the credit rates for grain bilateral project between the State Food and Grain Corporation of Ukraine and Chinese corporation SSES will be reduced.

"The rate of the Chinese loan will be reduced. The amount of reduction in the discussion are subject to approval by the Chinese side. The main thing achieved principled decision “said Taras Kutovy.

It was agreed to use loan funds for the implementation of two mutually beneficial projects: the purchase of grain wagons through an open tender and supply of plant protection products in Ukraine, presumably from China.

Tuesday, 21 March 2017

Latest USDA weather update for western FSU

Unseasonable warmth eroded the region’s remaining snowpack and accelerated winter wheat development in southern growing areas.

For the third consecutive week, above-normal temperatures (4-8°C above normal) prevailed, with daytime highs topping 10°C (above 15°C along the Black Sea Coast) in Ukraine and Russia’s winter wheat areas.

As a result, crops continued to develop up to 4 weeks ahead of average in the south, while spring grain planting progressed rapidly farther north.

At week’s end, the region’s snowpack was confined to Russia’s Volga District, more on par with the typical early-April extent.

Moisture reserves remained generally favorable for winter wheat development, though short-term dryness (less than 50 percent-of-normal precipitation over the past 60 days) in central and southern Ukraine reduced topsoil moisture for vegetative winter wheat.

Rain during the period was generally confined to western-most portions of Ukraine (10- 22 mm) and Belarus (5-15 mm), though light showers (2-8 mm) dotted central and eastern Ukraine and western Russia.

However, key winter wheat areas of southwestern Russia (Krasnodar Krai in the Southern District) benefited from 5 to 15 mm of rain at week’s end.

Latest USDA weather update for Europe

Mild, dry weather continued to promote earlier-than-normal winter crop development, though late-week showers boosted moisture supplies in key northern growing areas.

Winter crops over northern and eastern Europe broke dormancy two to four weeks ahead of average, and were now advancing through the vegetative stage of development in mostly good condition.

Winter dryness had been a concern in France and parts of Germany, though early-March rain coupled with this week’s late-arriving scattered showers (2-20 mm) eased lingering dryness concerns and improved soil moisture supplies for spring development.

Sunny, mild conditions (1-3°C above normal) also promoted winter crop development in Poland and the northern Balkans before light to moderate showers (2-15 mm) returned at the end of the period.

Meanwhile, a pair of slow-moving storms triggered widespread showers across southern Europe.

One storm produced 5 to 50 mm of rain (locally more) in southern Spain and southwestern France, while the other brought moderate to heavy showers (10-60 mm) to the southern Danube River Valley.

In the former, the moisture was beneficial for vegetative to heading winter grains in Spain, though northern parts of the country (Castilla y León) missed out and are in need of moisture.

In the lower Danube River Valley, the rain maintained adequate to abundant moisture supplies for wheat and rapeseed development.

Black Sea agribusiness news update in brief

In January 2017 Ukraine’s exports of agricultural products amounted to $1.36 billion, the highest for the last four years.

Ukraine’s State Forestry Agency and the Forestry Commission Scotland will join forces to conduct joint research on improving the viability of Ukraine’s forest ecosystems.

So far this spring season Ukraine has planted 359,000 hectares of spring cereals and peas which represent about 15% of the total forecast area of 2.40mha.

Ukraine is also reporting 5.7 million hectares or 81% of winter crops has received spring fertiliser which a) doesn’t concur with what we saw last week and b) if it is then it’s too early based on the growth stage of wheat.

Russia has planted 596,100 hectares or 1.1% of the total forecast spring sowing area and also applied spring fertiliser to 5.7 million hectares or 32.8% of the total planted area which is starting to make this whole Black Sea crop reporting thing appear more like an inter-country competition.

Russia’s Ministry of Agriculture reports current fertiliser stocks are up 7% on last year, up 1% on the last report at the beginning of March.

Russian January and February milk production increased by 2.7% compared to the same period last year and amounted to 2.39mmt.

The Director of the Department of Animal Husbandry and Breeding noted the increase in production highlighted the underlining priority in developing the milk sector (that or more cows calved).

Monday, 20 March 2017

The first Black Sea crop tour of 2017 is in the bag

We have safely and successfully completed our first Black Sea crop tour of the 2017 season.

Last week we travelled 3,000km from Moscow in Russia to Odessa in Ukraine, assessing the post-winter condition and yield potential of the current wheat crop.

I am now back in the office processing the results and writing up the reports which will include yield forecasts, crop condition assessment, comments and opinion.

We will email the reports out to subscribers later this week plus we hope to have some short videos made up so you can see what the crop looks like for yourself.

During the tour, we posted 64 pictures and six short videos on a Twitter account that is open to subscribers, we will post more videos there this week as we edit the large amount of footage we took.

The blog will be running a reduced service this week as we concentrate on writing up the results.

If you would like to subscribe to access the result from this tour and the rest of the tours planned through the 2017 season then email me at blackseacroptour@gmail and I will forward details.

Thanks to all who supported this tour and to those that assisted in making it happen.

Black Sea Crop Tours - the only independent crop assessment service operating in the Black Sea region

Sunday, 12 March 2017

The first Black Sea crop tour of 2017 is up and running

There will be a reduced service on the blog this week as we are out and about assessing the post-winter condition of wheat which will allow us to make our first yield forecast for Russia and Ukraine.

This is the first of ten Black Sea crop tours we have planned for 2017.

We will drive around 2,000km starting in Russia before crossing the border to Ukraine taking in a representative sample of the main wheat growing regions.

During the tour, we will post pictures, video and commentary on our dedicated tour Twitter account (@BSCT17) which is open to members only.

Shortly after the end of the tour, we will email members our full tour reports including our first yield forecast of the season based on our assessment of crop condition.

There are plenty of analysts currently reporting Black Sea wheat crop is in good condition but we will be the only ones that actually go there and independently take a look for ourselves.

If you would like to sign up to access the tour Twitter account and receive reports for this tour and follow the rest of the tours planned throughout the season all for only £350, then email us at and we’ll send you details on how to subscribe.

Further details can be found on our Black Sea Crop Tour 2017 page.

Black Sea Crop Tours - the only independent crop consultancy service operating in the Black Sea region.

Friday, 10 March 2017

Russia favour control of imported pesticides

Russia’s Ministry of Agriculture announced they are in favour of strengthening the control of production and the import of pesticides.

At a meeting yesterday the First Deputy Minister of Agriculture discussed the pesticide industry including measures to improve the regulatory framework for the import of pesticides. 

The Minister pointed out that with the increasing amounts of pesticides imported into Russia, counterfeit products are becoming an issue.

He goes on to say the problem is not just poor quality products but that they can also be dangerous or harmful to land and agricultural production which is a fair point, I've unknowingly bought counterfeit shampoo in the past, nearly blinded me.

The response is to tighten control of the origin and quality of imported pesticides and to encourage domestic production of plant protection products.

Reduced imports and increased production is now fairly standard ministry rhetoric but I wouldn’t expect anything much to happen anytime soon.

While it is possible that we might see some tightening of import procedures there will likely be resistance from large and well-connected farm businesses should pesticide retail price increase significantly before any substitute domestic manufacturing capacity, which will take time and investment to build, comes online. 

So Syngenta, BASF, Bayer and all the rest can breathe easy for now but you might want to consider looking at a business plan for building a factory in Russia inside the next five years.

Ukraine start planting

Ukraine's Ministry of Agriculture report spring planting is now underway in the south of the country with the first 600ha planted of which 500ha is peas, 60ha barley and 40ha oats.

Keep in mind that 600 hectares is a field in Ukraine, so the ministry is actually reporting one farm started planting.

According to preliminary ministry reports, the total planted area for 2017 is expected to reach 26.8 million hectares which are almost the same as 2016.

All grain crop planting is expected to reach 14.4mha or 54% of total crop area which the ministry conveniently report meets the standards for optimum ratio crops in the rotation whatever that is.

Planting of spring crops is forecast at 7.2mha including 2.4mha of spring cereals.

Wednesday, 8 March 2017

Russia’s food safety watchdog denies mass fusarium infection of grain

Russia’s food safety watchdog, Rosselkhoznadzor went on TV to deny mass poisoning of Russian grain.

The watchdog reported there have been 33 cases of grain contamination this season - most of them in the Caucasus and Southern Federal District.

The state standard is no more than 1% fusarium contamination and the Centre for Grain Quality Assessment say the grain they have investigated fits in with this figure.

In Russia, fusarium poisoning through eating products made with contaminated grain is called "drunk bread" as spoiled food causes symptoms similar to intoxication but can lead to more serious intestinal and gastric disorders.

Rosselkhoznadzor say the responsibility for poisoning by infected grain which hasn't happened is the fault of the public anyway by quoting doctors who say consumer ignorance is more dangerous than infected grain because citizens tend to remove mould from bread and then “quietly eat them”.

There might be a reason why citizens cut off the mould and eat the rest of the loaf.

Meanwhile, the Russian Centre for Grain Quality reported to the Russian Federation Council on the quality of the Russian 2016 wheat crop.

The volume of food quality wheat (Classes 3 and 4) reached a record level of 51mmt, or 71% of the total wheat crop.

However, both the total volume and the percentage share of wheat Class 3 to total wheat production in 2016 was at the lowest level in the last five years: 16mmt, or approximately 22% of the total wheat crop.

Furthermore, assuming Class 3 and better quality Class 4 are the pool from which exported milling wheat is sourced, then although 2016 was a large crop the total quantity of export grade wheat is almost the same as the previous year.

Tuesday, 7 March 2017

Latest USDA weather update for western FSU

Unseasonably warm weather further eroded the region’s remaining snowpack and accelerated winter wheat out of dormancy in southern growing areas.

During the 7-day period, temperatures averaged 6 to 10°C above normal, with snow cover at week’s end mostly confined to Russian crop areas north of the Southern District.

The warmth fostered rapid winter wheat greening in southern portions of Ukraine and Russia, where crops broke dormancy 2 to 4 weeks ahead of average.

Moisture supplies are favourable for wheat development in these areas, though some localised winter dryness has been noted in areas immediately adjacent to the Black Sea Coast.

Farther west, sunny skies and April-like warmth (daytime highs of 10-15°C) also promoted early spring grain planting in Ukraine and southern Belarus.