Sunday, 31 October 2010

Agronomy Update, Russia

A brief look at winter wheat in Russia, below or here.

video

Are oilseed rape autumn fungicides worthwhile?

I think so. Even though signs of diseases like phoma and light leaf spot are low they will be in the crop and will weaken the plant making it more susceptible to winter kill. Applying an autumn fungicide does pay dividends in improved yield.

Tebuconazole or metconazole also improves the general toughness of the plants, the treated plants, below, are darker, greener, shorter and just meaner looking.

Phony winter?

The snow and associated cold weather I experienced in Russia last week failed to materialise in Ukraine, thankfully.

The forecast is for a reasonably warm week with daytime temperatures in double figures and plenty of sun to warm up the ground.

There's a lot of late sown and slow developing crops that will benefit from the extra growing opportunities before we head in to the winter for real.

Saturday, 30 October 2010

Back from Russia

Managed to sneak a photo of that sellotaped barrier I was on about.

Apologies for the quality of the picture but I thought it best not to make it too obvious what I was up to, the poor buggers would die of embarrassment.

Thursday, 28 October 2010

Border crossing

Over the years I have crossed or tried to cross many borders, the Uzbekistan Afghanistan one sticks out as a notable failure. Some border crossings are fun, some not, most are just a big pain in the ricker.  

Crossing the Ukraine Russian border the other day was reasonably straight forward despite having two passports and a dodgy visa (long story involving a passport and a washing machine).  

The most noteworthy observation of the thirty minute process was that the final barrier in to Russia had previously been broken in two, perhaps by some individual desperately trying to escape Ukraine.

That in itself wasn't particularly unusual but the fact that it had been repaired with sellotape was.  

I kid you not, the barrier was actually held together in the middle with reams and reams of sellotape.  


From Russia...

In Russia at the moment, two inches of snow fell overnight.

We could do with a late growing surge to get crops a little further ahead before winter fully arrives. Having said that the wheat I have seen here in Russia is looking mighty impressive, plenty of well developed, healthy looking plants.

Although having crossed the border and driven around for three or four hours I will have only seen a tiny fraction of the total crop area. 

Trying to assess crop condition on this scale is a bit like, well, assessing the condition of 30 million hectares of crops from a car. I wonder how the USDA do it?



Monday, 25 October 2010

Kiev visitors #2

Busy week for Kiev traffic cops, Vladimir Putin is expected in town on Wednesday for talks with his counterpart Mykola Azarov.

Not been hyped up much this visit, the official line is talks about economic cooperation but it could be seen as a clear signal ahead of local elections this coming Sunday.

No chance of getting run over by Vladimir Putin’s cavalcade as I will be out of the country on a brief state visit of my own to Russia.

Kiev visitors #1

The Canadian Prime Minister Stephen Harper nearly ran me over in his motorcade not ten minutes ago. He was in a cavalcade of blue flashing lights and blacked out Merc’s complete with little flags on the corners

I have a small but dedicated group of Canadian readers and much appreciated you are too (any jobs going in Canada yet?).

Younger Canadian readers might be a little concerned to hear that Ukraine and Canada have just signed a bilateral youth exchange programme, I think the idea is you get sent to Ukraine if you do something naughty.

Don’t worry though, you might like it here, you can get served booze at any age, I think beer is actually on the school curriculum.

Saturday, 23 October 2010

Juxtaposition of the week

Marks & Spencer and Karma Police.

I walked in to the Kiev branch of M&S earlier today to hear Karma Police by Radiohead being played.

Those of you who are oblivious to the delights of M&S clothes shop think middle age, matching jumpers, comfy shreddies* or in other words the antithesis of Radiohead.

“And for a minute there, I lost myself, I lost myself…daa da da da daaa…”

*Shreddies; slang for grits, grundies, undercrackers

I’m in hot water

Back in May I mentioned that my hot water had been turned off for two weeks. Well I lied; it has actually been off for the last 6 months!

After digging a big hole, filling it in, digging a massive hole, leaving it, scratching heads, installing some pipes and filling it in again, full service has been resumed.

The hot water is also the central heating system which means we have hot water and heating. Hurrah!

Now the fridge has packed up. Great!

Friday, 22 October 2010

Bada booom!

It’s being reported that three small bombs went off next to government buildings in Kirovograd last night, hours before a visit by President Viktor Yanukovich.

Parts of an artillery shell, a clock and a battery were found next to one of the buildings. A ministry statement said it regarded it as acts of hooliganism.

My idea of hooliganism is knocking on a few doors and pegging it or putting a traffic cone on the town statue. This sounds more like the business end of hooliganism.

Where did I put that number for the body armour supplier…

The weather...

...has picked up, drying out with blue skies and forecast for a settled period. It will take a day or two for the soya to dry out and we can get the combines moving again but we should then have a clear run for a week or so.

It is cool though, no sign of an Indian summer which would help the oilseed rape along. Day time temperatures are rising in to double figures but wind chill and diminishing light intensity are making it less favourable for plant growth.

Wednesday, 20 October 2010

Is there a Green Zone in Ukraine?

Ukraine fell sharply in the latest press freedom index as produced by Reporters Without Borders and now ranks below Iraq.

Press censorship was cited as one of the reasons why Ukraine fell to an historical low.

No censorship on this blog I can assure you, all my own words, thoughts and invaluable insights absolutely buckshee. So now it’s official that I am risking my welfare by ignoring state censorship isn’t it about time you did the decent thing?

Wet and cool

Rain all over the place, harvesting and drilling stopped. We might just finish planting the last 100ha of wheat once it dries up in a day or two but I think that will be the end of sowing in Ukraine for this year.

I will dig out the planting figures and see how that compares with previous years.

Tuesday, 19 October 2010

It'll all be over by Christmas

We have finally finished harvesting sunflowers with 2.2MT off the combine. Prices continue to rise with the latest quotes from buyers now at 4,220UAH (338GBP).

Soya next!

Hope over reality

According to Leonid Kozachenko of the Ukrainian Agrarian Confederation, Ukraine could produce 105MMT of grain.

That’s “could” as in Liverpool "could" still finish in the top five. They could but it’s not going to happen, nope, not this year, no way.

There is about 42MHA of arable land in Ukraine with about half of it down to cereals. The average yield bumps along at around 2MT/HA which would give a national yield of 42MMT (last year it was 46MMT, this year looks like being 38.5MMT).

If Ukraine was to increase output to 105MMT and assuming a similar area of cereals was planted then the average yield would have to rise to 5MT/HA.

That’s an increase of 150%.

Even the best producers are struggling to get over four tons so I fail to see how Ukraine would ever achieve an average of 5MT/HA on 21MHA.

Monday, 18 October 2010

Planting news

I haven’t had time to analyse the figures in detail yet (still reeling from events on the pitch at the weekend – what was all that about?), but here are my impressions of plantings this autumn all the same.

Wheat
A lot of wheat has been planted late which will increase the risk of winter kill and what does make it through the winter will be lower yielding because it was planted late.

What has gone in is growing well and there are plenty of good looking crops around the regions.

Oilseed rape
Oilseed rape planting is reported at being 20% down on last year and many growers held off sowing until rain came which has resulted in 38kha being planted in the first week of October.

We finished planting by early September which I feel is the cut off point but as the soil was bone dry emergence was delayed to early October anyway.

This has resulted in small plants which will be at greater risk of winter kill resulting in a further reduction in the 2011 area. What is in the ground will probably yield less as it was late planted/emerged although rape does have better compensatory powers than wheat.

Too early to start predicting supplies for 2011 but if pushed I would say we are unlikely to see bumper cereal or rape yields next year.

How to spin yields

It’s that time of year when companies start publishing their performance results and yields feature highly as a performance figure.

While no one wants to dwell on bad news it is worth bearing in mind how we all spin yields to give a more favourable flavour to the story.

For example, you start off with 4,000ha of crop planted in the autumn.

Following a difficult winter and or summer you only have 3,280ha worth harvesting having lost 18% of your fields to hail/rain/fires/pestilence or whatever.

Once the combines have cut the crop and it passes across the dodgy soviet era weighbridge in to the shed you find you have 9,800MT.

9,400MT off 3,280ha is 2.87MT/ha.

Let’s call it 2.9 which is as near as damn it is 3 as makes no difference so let’s call it 3.

This year our crop yielded about 3MT/ha. Hurrah!

Except what you actually produced was 9,400MT of 4,000ha which is 2.35MT/ha. Even though you didn’t combine those hectares you did spend the money on them.

And this is what went in to store. When you bring it out of store, allow a conservative 10% for “shrinkage” plus a conservative 4% for “admix” what you actually sell is 8,122MT

So, 8,122MT of 4,000ha is 2.03MT/ha.

Or about 2MT/ha.

Sunday, 17 October 2010

Sunday footie

Talking of murky dealings, Liverpool FC finally ditched the dodgy duo and now has a new owner, let’s hope this is the start of a beautiful relationship.

As the Toffees prepare to host the Reds in this afternoon’s derby, I managed to take time out yesterday to watch another derby, this time in a village in Ukraine.

Teams were suitable attired in red and blue and I swear Shrek was playing centre forward.
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Ker-ching #2

I previously mentioned the governments directive that growers will have to supply some of their wheat to the government for “food security”. Here’s some figures on the subject.

We have been asked to supply 100MT of milling grade wheat for which we will be paid 1,300UAH per MT.

Current domestic market value is 1,500UAH per MT.

Loss to the grower = 20,000UAH or 1,500GBP or 2,500USD.

Sweet Lord!

This is an unsubstantiated rumour but the latest ruse I am hearing is that growers will have to plant 5% of their cropping area with sugar beet.

I suspect it will go the same way as most directives and will be roundly ignored but it does give you some flavour of what farming in Ukraine is up against.

Obviously no one will invest in the specialist planting and harvesting machinery required to grow sugar beet based solely on a government directive, thus giving the local administration the opportunity to fine you for not complying. Ker-ching!

Friday, 15 October 2010

Weather

Looks like we might have some rain over the weekend to slow down harvesting operations and probably put an end to the last of the winter wheat sowings.

I haven't checked the figures yet but my gut feeling is that wheat and oilseed rape plantings will be down this year. Watch out for all those spring planting over estimations as a result.

Sunflower prices

Continue to firm up with recent quotes from buyers coming in at 4,000UAH (314GBP).

Thursday, 14 October 2010

Someone has to be first

As far as I can tell a lawyer with the law firm Volkov and Partners is the first to publicly question the validity of Ukrainian grain export quotas.

“The only possible reason to introduce quotas may be for critical want of foodstuff in the exporting country, but the draft decree does not identify such critical deficiency prevention as the purpose for its adoption,” said Iryna Polovets.

This is what the WTO said to me back in September.

"...a member of the WTO can impose export prohibitions or restrictions on condition that they are temporarily applied to prevent or relieve critical shortages of foodstuffs or other products essential to that country."

So what constitutes a “critical shortage”?

Wednesday, 13 October 2010

A new boss at the zoo

Oleksiy Tolstoukhov will take the helm at the zoo from this Friday. .
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I don't imagine it will be a very arduous posting as there can’t many animals left to look after since the spate of mysterious deaths earlier this year.

Oleksiy 31, is the son of the Minister of Ukraine's Cabinet of Ministers.

Harvest update

Remaining cool and dry; sunflower harvesting on the final leg, we should finish by the weekend and then move on to soya.

Sunflower prices remaining firm at 3,800UAH (300GBP) with indications that it will continue to rise for some time to come.

Tuesday, 12 October 2010

Weather & harvest update

Cool but dry. Localised light rain yesterday will continue to delay harvesting where it fell but elsewhere should be able to get going again later this morning.

Quote of the week #2

“Investors no longer believe fairytales about Ukrainian agriculture.”

Alex Lissitsa, president of the Ukrainian Agribusiness Club.

Absolutely Alex. However there are still plenty of people who do, personally I blame the rise of the spreadsheet.

“If we get four tons of wheat on ten fousand ‘ectares and flog it at hundred quid well make 4 million!”

Tappity tap tap tap (that's the sound of a key board as spurious figures are tapped in to a spreadsheet).

“Hang on a minute, if we get eight tons on one hundred fousand ‘ectares and sell it at one ‘undred and sixty quid we’ll be filthy rich! Ferraris all round!”

Full quote here.

Thinking of investing in Ukraine #2

Here’s a salutary story.

In central Ukraine there is a steel mill that was originally owned by the state.

Messrs Rinat Akhmetov and Viktor Pinchuk almost bought the mill for $800 million.

In 2005 President Viktor Yushchenko and Prime Minister Yulia Tymoshenko auctioned it off what was widely regarded as an open and honest transaction to the pan global steel company ArcelorMittal for the heady sum of $4.8 billion.

Today state prosecutors are claiming the new owners have not met their investment commitments.

Many observers believe this is the first steps in how the government will take the plant back and subsequently sell it off to favoured friends of the party.

Do not panic! Act normal and go away!

The Organization for Security and Co-operation in Europe is a primary instrument for early warning, conflict prevention, crisis management and post-conflict rehabilitation.

Should we be worried when we see the following advert in the local Kiev newspaper? Do they know something we don’t?

Monday, 11 October 2010

How many sunflowers are growing in Ukraine?

Now there is a conundrum.
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The ever interfering government has put restrictions in place that limit the frequency that growers can plant sunflowers to one year in seven.

Therefore growers have understandably lied about the amount of sunflowers they are growing to avoid prosecution and will continue to do so making any government statistics on the subject completely unreliable.

The seven year rule is not based on any scientific data but is an attempt to extort cash out of farm producers by fining them for breaking the rule.

Weather, harvest and drilling update

Cool and damp; combining of sunflowers stopped; drilling of late wheat slowing down where too wet; could do with a few days of warmth to get the oilseed rape and wheat in a more favourable condition for the winter.

Quote of the week

"I think 90 percent of Ukraine's police force is made up of honest people, who are just doing their jobs."

Anatoliy Mohyliov, Interior minister.

Sunday, 10 October 2010

Imagine that!

Multi millionaire John Lennon sang “Imagine no possessions” while sitting at his grand piano in his Hampshire mansion.

He also wrote “I am the walrus, goo goo g'joob g'goo goo g'joob.” What was all that about?

Happy birthday John.

Saturday, 9 October 2010

Harvest update

Some light rain overnight but combines running again this morning. Weather currently dry and cold but more rain on the way.

London wheat close yesterday

Feed wheat closed +6.2%; milling wheat 7.6%.

OK so the USDA report released around lunchtime yesterday did a lot to push prices north but the news from Ukraine would have certainly contributed.

So far this morning I have read very little comment on Ukraine export quotas. Is that because making official what has been widely accepted to have been going on anyway is not newsworthy?

Friday, 8 October 2010

London wheat 16:45

Feed wheat +4.9%; milling wheat +7.2%.

London wheat 15:45

Feed wheat +3.9%; milling wheat +7.1%.

London wheat 14:45

Feed wheat +7.4%; milling wheat +9.0%.

London wheat 14:00 hours

Feed wheat +4.9%; milling wheat +7.1%.

Agronomy Update

A quick look at sunflower harvesting below or here.

video

London wheat…

…up 0.5% and the market has only just opened. Let’s watch how the day pans out on the news from Ukraine.

The lunatics are on the grass

Mykola Riabchuk is one of Ukraine’s leading intellectuals and gives a very informed perspective on Ukrainian politics (here).

I particularly like the comparison of Ukrainian politics to a lunatic asylum, and Russian politics to a cemetery. “In the lunatic asylum, theoretically, you can be cured. In the cemetery, you can’t”.

Another example of how not to encourage private enterprise and business innovation?

Thousands of Kyiv kiosks to be removed, relocated or destroyed.

There are 10,843 permanent and temporary licensed kiosks in operation of which 806 have become illegal following a moratorium imposed by Kyiv City Council deputies.

Deputy head of Kyiv Administration Oleksandr Mazurchak said "this is why we are trying to solve the kiosk problem" noting that up to 1,300 kiosks would be removed, relocated or destroyed.

The local authority brings in a law that makes kiosks illegal unless they register presumably at a cost and if you don’t they will destroy your business.

I have lived and worked in Kyiv for years and I have never ever heard of the “kiosk problem”, “a lack of kiosk problem” perhaps.

Thursday, 7 October 2010

Good comedy is in the timing

As the Ukrainian government announce a ban on grain exports thereby restricting access to international markets, Viterra announce it is opening a marketing office in Ukraine to bolster its access to international markets.

That’s just flippin’ great that is!

Unofficial grain export quotas finally made official.

The long drawn out political spin has finally come to an end as the government officially imposes a ban on grain exports.

Deputy Prime Minister Andriy Klyuyev said that grain imports this year will be limited to 2MMT of corn, 0.5MMT of wheat and 0.5MMT of barley.

I defy anyone in the Ukrainian administration to justify why this is considered to be good governance.

Think this won’t affect you? Think again. The announcement which was made yesterday afternoon will only drive already high grain prices even higher as the panic sets in.

Watch the market over the next twenty four hours and wait for the empty words of righteous indignation from point scoring politicians and watch no one, I mean no one, not the IMF, the WTO, the EU, the US, no one do anything about it.

Great stuff lads!

The rules of business

Thinking of running a business in Ukraine? Then you might find it useful to run through this score card of attributes to see how you would stand up.

1. Would you describe yourself as tough?
a. As nails mate, you want some?
b. When I’m in my car.
c. No.

2. Do you have a heart, back or neck condition?
a. Nope, tough as nails me.
b. Only after a night on the lash.
c. All three plus haemorrhoids and a flaky scalp.

3. Can you consume heroic quantities of vodka and still calculate a ROI
a. You’re my besht new mate, hic, 15%!
b. I could work it out with a pencil.
c. White wine for me please.

4. Which statement best describes your principles?
a. Those are my principles and if you don’t like them, I have others.
b. A moral and business code to be adhered to as and when it is expedient.
c. A moral and business code to be adhered to at all times.

5. What are your thoughts on corruption?
a. Ha! Thatcher sold me my own council house!
b. Define corruption.
c. A despicable thing, there should be a law against it.

How did you score?
Mostly A - congratulations, you have a small chance your business will flourish, unfortunately you probably wont be the owner by then.

Mostly B - your business will survive approximately long enough to have all the assets stolen.

Mostly C – oh dear, stay at home, invest in premium bonds.

Cropping update

Weather cool but dry.
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Harvesting of sunflowers, maize and soya continues. The harvest is much further ahead than this time last year as the high summer temperatures caused many crops to senesce much earlier than normal.

As a result expect to see much lower yields particularly maize and soya; deep rooted sunflowers appear to have fared much better.

Sowing of winter wheat still progressing. Rain over most parts has gone some way to replenishing soil moisture which will help with germination and development.

Oilseed rape is variable. Crops which had some rain in early September are starting to look reasonable although smaller than you would like. Crops that missed the earlier rain are patchy and small. If we get a couple of good growing weeks then they might get big enough for the winter.

Wednesday, 6 October 2010

Ukrainian needs $1 trillion investment

Prime Minister Mykola Azarov has said that Ukraine needs $1 trillion to modernize its economy within the next ten years.

It would help if the business environment was conducive to outside investors.

Update

Weather sunny and dry as forecasted; combines worked through the night. We should get a good run at harvesting and planting today.

Tuesday, 5 October 2010

Customer service #1

Earlier today called in to a garage for some petrol and a map.

"Do you have any maps?" I politely enquired, looking around the shop at the vast array of vodka and cheap champagne.

"No" came the unequivocal answer.

"Well what the feck is that vast selection of fold out maps, road maps and city maps just behind your head numb nuts?"

Customer service #2

Took the opportunity of wet weather to go to the cinema at the weekend, big corporate multiplex of a place outside Kiev.

While waiting for the film to start decided to grab a coffee from one of the formulaic food retail outlets that populate these sort of places.

Ordered coffee then sat down about twenty yards away from the counter (it was a big multiplex of a place).

Two minutes later Yuri comes over to tell me my coffee was on the counter!

He made my coffee, placed it on the counter then walked the twenty yards to tell me my coffee was on the counter while actually pointing back at it!

Weather

Forecast is for a settled period which will allow harvesting to continue and wheat planting to grab another week or so.

This next ten days will make a big difference to overall wheat plantings. The recent rain followed by a forecasted settled warm (ish) period will allow these later planted crops a good chance to establish and become physiologically mature enough to withstand the winter.

I will stop drilling by the 15th of this month, any later and crops just lack vigour although you have to be very strong to stop when soil and weather conditions look fab as is often the case in mid October; that infamous winter is just around the corner.

Combines rolling

Sunflower moisture down to 9.5% so the combines underway earlier today. Yields so far of 2.3MT compared to the Ukraine average of 1.5MT; selling at respectable 3,800UAH (300GBP) with rumours of the price hitting 4,000UAH (317GBP).

Sunflowers are once again going to do a lot of growers a big favour this year.

Monday, 4 October 2010

The IMF

Not to be confused with the EMF. Unbelievable!

Mr. Dominique Strauss-Kahn, MD from the International Monetary Fund paid a visit last week and in his press release said that Ukraine faces many challenges to ensure sustainable growth and to improve living standards.

I really wish these guys would make the transcripts of their meetings public, surely they discuss more than just rhetoric.

You can read the press release in full here although the only interesting thing to make from it is the reference as to how the IMF support the government in implementing its economic programme and how the IMF looks forward to continuing to work closely with the government and people of Ukraine.

So it looks like the IMF are happy with the way things are for now and are unlikely to put any pressure on the government to improve its democratic processes any time soon.

Heating season in Kyiv starts Oct. 4

Deputy head of the Kyiv Administration Oleksandr Popov has announced the central heating will be turned on today.

Heating is usually turned on during the middle of October but as it is colder than usual for the time of year city authorities have graciously decided to fire up the boiler early.

My Dad would have never caved in so easy, “put another jumper on if your cold you pussy and turn the lights out while you at it.”

Schools and hospitals will be heated first. Radiators in residential buildings will start working later in the month.

Last Christmas I spent two weeks in hospital while they did their level best to bugger up an appendectomy. One appendix, three operations, seven holes and all with no central heating or hot water.

How I laugh now!

Thinking of investing in Ukraine?

The Government has just changed the constitution to give the President more power and the President commands a majority of loyal judges within the Constitutional Court.

There has been a de facto ban on wheat exports restricting access to lucrative foreign markets and depressing the local price as a result. This has been in direct violation of WTO rules who have done absolutely nothing about it.

The government is trying to “acquire” grain from farmers for food security. They are telling producers to provide the state with grain at 30% below market value.

The harsh winter and blistering summer depressed yields right across the country, it has been one of the most difficult cropping seasons I have ever experienced.

Having said all that the bullish rise in soft commodities has renewed interest from investors and the returns from farming are still there if managed correctly.

Oops I did it again!

One Friday the Government voted to overturn constitutional reforms passed in 2004 and return important powers to President Viktor Yanukovych.

Additionally the President now commands a majority of loyal judges within the Constitutional Court who will ratify anything the administration wants.

Is this all to keep hold of the power? The opposition think so and claim they are being intimidated, harassed and excluded from the airwaves.

Supporters suggest it is what is needed to push through the reforms needed to get the country pointing in the right direction.

Time will tell.

Weather & harvest update

Plenty of rain about over the weekend so time to catch up with some sleep.

Harvesting of sunflowers, landwork and drilling all stopped for the time being. Dry at the moment and forecast is for a settled period so everything should get underway pretty soon.