Monday, 31 October 2016

Final Black Sea crop tour of 2016 just about to get underway

We are about to kick off the final Black Sea crop tour of 2016.

Once I finish writing this I will head off to the airport to start the journey that will take me through Russia and Ukraine where I will be taking a look at the condition of the recently planted winter crops with a focus on winter wheat.

The aim is to take a view on how well the crop will stand up to the rapidly approaching winter before it disappears beneath snow because once the snows do arrive we have no way of telling what is happening to the crop until the spring thaw.

I will be posting pictures, video and commentary on the crop tour members twitter account @BSCT_01 and writing up a follow up report once we have finished, see previous posts below if you would like to subscribe and join us.

You can also follow our crop tour twitter account from last year @AgronomyTour which is now open to get an idea of what we will be reporting on during the rest of this week.

Alternatively you can follow the @AgronomyUkraine twitter account completely buckshee where I will post the usual collection of encounters we happen upon as we travel around the mighty grain producing regions of Russia and Ukraine.

Wish us luck.

Kazakhstan harvest 23mmt of grain

Kazakhstan’s Ministry of Agriculture report the current harvest stands at 23.6mmt of grains (18.3mmt in 2015) from 15.3mha or 99.8% of the cropped area.

The total average yield was 1.54mt/ha compared to 1.31mt/ha in 2015.

Total output is up nearly 30%, driven in part by a 10% increase in hectares planted but also an 18% increase in yield per hectare reflecting the favourable weather conditions experienced over much of the Black Sea region this year.

We are hoping to include a crop tour through Kazakhstan's grain growing region next spring if we can raise sufficient funds, watch this space.

Ukraine harvest 53mmt of grain

Ukraine Ministry of Agriculture report the current harvest stands at 53.7mmt of grains (53.3mmt in 2015) from 12.5mha or 87%.

The overall average yield is 4.30 mt/ha with the breakdown looking like this;
  • corn 14.7mmt from 2.4mha (59%) with an average yield of 5.90mt/ha
  • sunflower 11.8mmt from 5.4mha (92%) with an average yield of 2.19mt/ha
  • soya 3.4mmt from 1.5mha (86%) with an average yield of 2.19mt/ha
As of October 28, farmers had planted 6.4mha of winter crops for H17 or 87% of the planned area, up 279kha on 2015.

This includes 5.5mha of winter wheat and triticale, 698kha of winter barley, 152kha of winter rye and 796kha of winter oilseed rape.

Friday, 28 October 2016

Russia harvest 119mmt of grain

Russian Ministry of Agriculture report the current harvest stands at 119.3mmt of grains from 44.7mha (43.5mha in 2015) or 94.7%.

The overall average yield is 2.67mt/ha compared to 2.42mt/ha in 2015 with the breakdown looking like this;
  • wheat 75.8mmt from 27.2mha (98%) with an average yield of 2.79mt/ha
  • barley 19.1mmt from 8.1mha (97%) with an average yield of 2.35mt/ha
  • corn 9.2mmt from 1.6mha (57%) with an average yield of 5.59mt/ha
  • sunflower 9.2mmt from 5.8mha (77%) with an average yield of 1.60mt/ha
  • soya 2.7mmt from 1.7mha (78%) with an average yield of 1.59mt/ha
 As of October 27 farmers had planted 16.7mha of winter crops for H17 or 97% of the planned area (15.6mha in 2015).

Russian barley quality officially lower than last year

Russia’s veterinary and phytosanitary service, Rosselkhoznadzor, are assessing the quality of this year’s grain crop.

The reason, they say, is because many experts have called into question the quality of this year’s harvest without having any reliable data (me included) and, presumably, they want to straighten the records with some reliable data.

The Centre for Grain Quality Assessment is working on determining the quality of the new grain crop in 40 major grain-producing regions of Russia.

Today they released some information on barley quality with, I assume, wheat to follow on later.

I’ll be honest here and say that it’s a bit tricky to penetrate and translate the data but this is what I think they are saying.

Barley is divided into two classes: 1st class for human consumption and 2nd class for feed and alcohol production (that will be industrial alcohol and not malting).

This year 2.5mmt of barley has been assessed or 38% of the gross yield from the sampling region resulting in 1st class 4%; 2nd class 96%.

Last year the survey assessed 47% of the gross yield from the sampling region resulting in 1st class 14%; 2nd class 86%.

The Centre for Grain Quality Assessment say “today we are witnessing a shift in the balance of classes for barley from 1 toward 2 compared with previous years” but warns us that that such a transfer “should not be a cause for excitement as the information will still be supplemented and refined”.

Don't know about you but a shift from 14% to 4% is pretty exciting to me, can't wait for the wheat results (I probably should get out more).

Ukraine wheat plantings down a second successive year

Earlier this season Ukraine’s Ministry of Agriculture had forecast 7.4mha of winter wheat will be planted this fall but have since dropped their forecast to 6.2mha, which, coincidentally is exactly what has just been harvested.

As of Tuesday this week the official plantings for winter wheat and triticale stood at 5.359mha, about the same at the same point last year, so it’s conceivable that growers could finish above 6.2mha.

Except last year was dry and this year is wet; you can plant in the dry but it's awfully difficult to plant in the wet.

As we reported at the beginning of this week, Ukrainian farmers will have to get a move on to plant that final million hectares in the next ten days.

Planted hectares will rise further as reporting data filters through the system but wet, cooler conditions, restricted cash flow, general uncertainty and attractive spring planting options will do nothing to encourage farmers keep the planters in the field any longer than they have to.

The other consideration to take into account is what will the winter do for crop survival?  

Last year Ukraine ended up harvesting 6.2mha but plantings had stood at 6.7mha.  

Winter kill is usually around 5% which would mean a 6.2mha planted crop would turn into a 5.9mha harvest.  

But winter kill can be 10% or higher so 6.2mha could end up as 5.6mha or even 5.3mha.

I will be taking a look at the condition of Ukraine (and Russian) wheat next week primarily to assess how well it might stand up to the fast approaching winter, check out previous posts below to find out how to follow and receive pictures, video and reports directly from Ukrainian (and Russian) fields.

Thursday, 27 October 2016

Kazakhstan harvest 23mmt of grain

The Kazakhstan Ministry of Agriculture report that, as of October 27, the total grain harvest stands at 23.6mmt which is an increase of 3.9mmt on last year.

Harvest is all but finished with 15.34mha cut giving an average yield of 1.53mt/ha, up 200kg from 2015.

About 75% of Kazakh wheat is produced in three oblasts located in north-central Kazakhstan: Kostanai, Akmola and North Kazakhstan.

Wheat has been an important crop for the country in the past although production has been in decline as the agricultural policy favours livestock production particularly dairy.

I’ve had the privilege of visiting Kazakhstan in the past and would recommend a trip, the farming is fascinating and the hospitality is legendary and we are hoping to start including Kazakhstan in next years crop tours.

Black Sea crop tour starts next week

Here at Agronomy Towers we are gearing up for the last Black Sea Crop Tour of the season.

Middle of next week will see us travelling through Russia and Ukraine to assess the condition of the autumn planted wheat crop as it moves in to dormancy and disappears under the snow.

At some point each winter we normally experience a minor crisis when the crop is considered to be at risk, usually because of a mini thaw or extreme cold or a combination of both.

Assessing the crop now will give us some confidence of what might be happening to the plants when they are under snow and inaccessible and give us a sense of the crops capability to stand up to whatever the winter may bring.

This will then lead on to the first crop tour of next spring when we will look at the post winter condition of the crop as it emerges from under the snow.

As an agronomist I would be doing this anyway, having a feel for the crop condition would allow me to adjust inputs according to yield potential come the spring.

Having an understanding of the crop pre and post winter will allow us to better gauge yield potential projections through next year.

If you would like to support us and subscribe to our autumn tour for $250 send me an email.

This will give you access to the members only Twitter account where I will post pictures, short video and commentary on what we are seeing as we are seeing it plus a follow up report detailing our findings and thoughts once we have finished.

Next spring we will be again offering an annual subscription for all the tours we have planned for the year, I will be posting details on this in due course.

We are the only independent independent crop assessment operating in the Black Sea region, drop me a line if you have any questions.

Wednesday, 26 October 2016

Ukraine harvest 52mmt of grain

Ukraine Ministry of Agriculture report the current harvest stands at 52.2mmt of grains (52.5mmt in 2015) from 12.2mha or 86%.

The overall average yield is 4.26 mt/ha with the breakdown looking like this;
  • corn 13.2mmt from 2.2mha (54%) with an average yield of 5.83mt/ha
  • sunflower 11.5mmt from 5.2mha (89%) with an average yield of 2.19mt/ha
  • soya 2.5mmt from 1.5mha (82%) with an average yield of 2.17mt/ha
As of October 25, farmers had planted 6.1mha of winter crops for H17 or 83% of the planned area, up 71kha on 2015.

This includes 5.3mha of winter wheat and triticale, 592kha of winter barley, 150kha of winter rye and 781kha of winter oilseed rape.

Russia harvest 118mmt of grain

Russian Ministry of Agriculture report the current harvest stands at 118.2mmt of grains from 44.5mha (43.3mha in 2015) or 94%.

The overall average yield is 2.65mt/ha compared to 2.42mt/ha in 2015 with the breakdown looking like this;
  • wheat 75.8mmt from 27.2mha (98%) with an average yield of 2.79mt/ha
  • barley 19.0mmt from 8.1mha (97%) with an average yield of 2.35mt/ha
  • corn 8.2mmt from 1.5mha (51%) with an average yield of 5.55mt/ha
  • sunflower 8.3mmt from 5.1mha (68%) with an average yield of 1.62mt/ha
  • soya 2.5mmt from 1.5mha (70%) with an average yield of 1.63mt/ha
As of October 20 farmers had planted 16.4mha of winter crops for H17 or 95% of the planned area which is up a significant 0.8mha on 2015.

Russian 2017 milk production forecast to fall half percent

The latest USDA annual report on Russian milk and dairy production has been posted, here’s a few highlights.

Cows-in-milk will decrease by 3% to 7.32 million head due to low investment in cattle over the last two years although fluid milk production will decline at a slower pace due to rising per cow yields at leading farms.

Household farms account for around half the national herd but raw milk from households is excluded or has limited access to the industrial dairy processing supply chain.

Commercial dairies are expected to increase fluid milk production in 2017, while backyard farms continue to decrease output although the increase will not offset the decline at backyards, as uncertainty in state support programs and budgets has stalled new investment.

As a result, total production of Russian fluid milk in 2017 is forecast to decline 0.5% to 30.195mmt.

This is an all time low and compares with record high's of 55-56mmt back in the early nineties. 

The economic benefits of highly productive dairy cattle is clearly understood by the Government and they recognize the need to improve the genetics of the country’s milking herd, however, budget constraints in 2017 will limit direct support.

Government support cattle breeding will be restricted to indirect support such as exemption from counter-sanctions trade restrictions for live cattle or genetic material imports and tax breaks for domestic and imported purebred breeding cattle, embryos, and semen of purebred bulls.

Tuesday, 25 October 2016

Latest USDA weather update for western FSU

Cold, dry weather favoured fieldwork and eased winter crops toward dormancy.

Precipitation was confined to western-most portions of the region (Moldova northward into western Belarus), maintaining soil moisture in these locales for winter crop establishment.

Elsewhere, dry weather facilitated seasonal fieldwork, including corn and sunflower harvesting in Ukraine.

Temperatures for the week averaged 3 to 6°C below normal, with hard freezes (-2°C or lower) reported in all but the southern-most winter wheat areas.

Winter wheat likely approached or entered dormancy from northern Ukraine into central Russia, where weekly average temperatures were below 5°C; weekly average temperatures above 5°C across the Black Sea coastal areas indicated wheat was still adding vegetative growth, or at the very least not yet dormant.

Ukraine's Ukrlandfarming in talks to sell stake

Interfax report the owner of Ukrlandfarming, Oleh Bakhmatiuk, is considering selling a majority stake in the company.

According to the news agency, he is in talks with Chinese companies and investors from the Middle East but did not say what size stake he might sell.

Bakhmatiuk explained how the main issue is a dispute with the National Bank regarding the financial debt of his banks and companies.

Earlier this year, a Ukrainian court approved a request from the central bank to freeze real estate assets belonging to Bakhmatyuk in connection with the failure of a bank owned by him to repay $160 million of loans.

Ukrlandfarming produce grain, sugar, livestock and eggs and owns London-listed Avangardco, Europe's largest producer of shell eggs and dry egg products, which reported a $158 million loss for 2015, from a $26 million loss in 2014.

Did Ukraine restrict how many hectares of sunflowers it can grow? *Updated

Ukraine’s Sunflower harvest is expected to reach a record 13.0mmt this year, up nearly 1.5mmt on last year.

Between 2007 and 2010 sunflowers grew in popularity because farmers realised they are straight forward to grow, didn't mind the heat and dry and harvested early enough to still give you planting options in the autumn.

Then between 2010 and 2015 Ukraine's sunflower hectares remained stubbornly static at around 5.4mha before shooting up to just under 6.0mha in 2016 causing many to predict Ukraine will continue to plant more sunflowers in 2017 and beyond which might well be the case. 

However there is one nagging issue which means they might not.

Back in 2011 the Yanukovych government took a dim view on sunflowers preferring to promote corn and corn exports to raise much needed cash for his regime.  I remember being told by a number of officials that if we planted more sunflowers we could expect problems but if we planted more corn then that would be absolutely fine.

Then, at some point around that time, the government issued a decree or passed legislation – it never was clear to me if it was actual law or not – that stipulated the number of years a farm must leave between planting a crop and planting the same crop again.

On the face of it, it kind of made sense, to limit nutrient mining by farmers and to encourage longer rotations than was being practised at the time. 

I can’t remember or find the details of the legislation but I do remember most of the regulations seemed broadly sensible and in agreement with general agronomic principles by stipulating breaks of three or four years between most crop types.

Except sunflowers. 

The regulations for sunflowers stated there must be an eight year break between sunflower crops.

Much discussion ensued that claimed the deep roots of sunflowers depleted the soils of nutrients much more rapidly than any other crop and therefore there needed to be a much long break between crops.

Which seemed like hogwash on a number of levels to me. 

Sure enough the longer the rotation and the greater the variety of crops within the rotation the better it is; we’ve known about that since Charlie Townshend championed the four course rotation back in the 16th century (actually we’ve been practising crop rotations since 6000BC but you get the point).

The question now then is, does that eight year enforced sunflower break still stand, because if it does, one in eight of Ukraine’s 42 million hectares of arable land is about 5.2mha.

So technically Ukraine might not allow itself to increase sunflower hectares above over this year’s 5.9mha crop.

* Since publishing this post it was brought to my attention that once Yanukovych left Ukraine the legislation on rotational constraints was dropped like a red hot potato thereby confirming it was hogwash and politically motivated.

But it does illustrate the power administrations have over food production and the environmental impact as currently being witnessed in the UK post CAP Brexit fall out and Russia's import substitution policy.  

Thanks go to my pal Richard for updating me on Ukraine.

Monday, 24 October 2016

Ukraine's latest harvest and planting figures

Ukraine’s Ministry of Agriculture have released the latest harvest and planting figures.

Corn harvest currently stands at 12.5mmt (14.8mmt in 2015) from 2.1mha (51%) which gives an average yield of 5.9mt/ha.

Sunflower harvest is running at ​​11.3mmt (10.3mmt in 2015) from 5.2mha (87%) with an average yield of 2.17mt/ha.

Soya harvest is 3.2mmt (3.3mmt in 2015) from 1.5mha (81%) with an average yield of 2.1mt/ha.

Meanwhile total winter crop plantings stand 5.9mha (6.0mha in 2015) from a forecast final figure of 7.4mha.

This includes 5.3mha of winter wheat and triticale (5.2mha in 2015) from a forecast 6.2mha which means plantings are at 85%, which also means they will have to get a move on to get the final million hectares planted in the next ten days or so.

Given that the Ministry reported the final wheat area for 2015 harvest was 6.2mha, this means we could potentially be looking at a slight increase in hectares for 2017 spring and winter wheat depending on how the next few days work out.

Winter barley plantings stand at 544kha (637kha in 2015) from a forecast 1.0mha which I don’t see increasing much now.

Winter rape plantings are ​​777kha or 107% of what was forecast.

And finally, as of October 24, 2016, Ukraine’s Ministry of Agriculture report the buckwheat harvest is finished with 187kmt of Ukraine’s favourite food now safely in the shed.

November Black Sea crop tour details

Next week we will travel through Russia and Ukraine to independently assess the condition of the fall planted wheat crop prior to the onset of winter.

This will give us an idea of the crops ability to withstand the cold months ahead, some indication of how the crop will react depending on what the winter throws at it and what we might anticipate to find in the spring once the snows melt.

Subscription only costs $250 which will give you access to the members only tour twitter account and a complete follow report after the tour is finished.

The tour twitter account will be posting pictures, short video and comments in real time during the tour and the follow up report will detail the route, methodology, results and discussion

If you would like to support us in providing the only independent crop assessment of the Black Sea region then please email blackseacroptour@gmail for payment details or with any further questions.

Kazakhstan wheat yield up but quality down

USDA office in Astana currently estimate the Kazakhstan wheat crop at 16.0mmt, up significantly on last year’s 13.7mmt crop.

The Kazakhstan Ministry of Agriculture reported that, as of October 3, farmers had harvested 97% of the wheat crop, collecting 22.5mmt of all grains in bunker weight, with an average yield at 1.5mt/ha.

However, as with much of the Black Sea region this year, quality is being called into question.
Kazakh farmers report the 2016 crop is unusually poor with low gluten content making much of the wheat unusable for milling and intensive rains during the summer causing a number of problems including septoria, rusts, undeveloped grains and high moisture content.

Apparently many farmers had wanted to apply fungicides but dealers were unable to meet demand due to low supplies and agronomists are reporting yields for crops treated with fungicides at 1.8mt/ha and fields not treated yielding 1.0 - 1.2mt/ha.

It’s reported that farmers are holding on to grain waiting for the price to rise, which makes sense, with a few sales taking place for immediate cash flow needs but bearing in mind it’s pretty much all spring wheat then there’s not much cash flow needed until February/ March.

USDA Astana estimate wheat exports will be 8.2mmt on the back of the bigger crop with the Russian grain transporting company, Rusagrotrans, saying Kazakhstani wheat will be in demand from Russia, particularly the better quality stuff, and the rouble/tenge exchange rate will make the price for Kazakhstani wheat very attractive.

All of which will only increase the amount of feed wheat available in Russia this year that will soon be looking for a home.

(n.b. we are investigating extending our crop assessment service into the Kazakhstan wheat growing region for 2017 if we can generate sufficient support, drop me a line if you would like further details)

Friday, 21 October 2016

Questions starting to be asked about Russian wheat quality

More reports in the media this week that are starting to question the quality of the bumper Russian wheat crop now sitting in the shed.

The USDA Russian grain report mentioned industry analysts consider the overall quality of wheat is worse this year than last.

SGS did a lengthy piece on how hydrothermal (weather?) conditions during vegetation basically did for protein and gluten.

The US strategic forecasting company, Stratfor, confidently report that much of the Russian wheat yield is of substandard quality while in the same article admit that information on the quality of the Russian harvest is not readily available.

These are just three from half a dozen or so news reports that floated across my desk this week which highlighted quality and the drop in milling grade compared to previous years.

Interestingly for all the weather related reasons given in these reports not one mentions the extensive lodging that we saw as a result of the excessive stem elongation as crops grew unabated by a shortage of water.  And by extensive I mean we saw lodging everywhere, Stavropol; Krasnodar; Rostov; Voronezh; Lipetsk; Tambov right up all the way to Moscow. 

As lodging would do more for reducing quality than rain per se then it makes you wonder if the reports fail to mention it, did any of the authors get out of the city to go and have a look?

And no one mentions that it was an avoidable issue.

Some plant growth regulators at early stem extension along with ramping up fungicides then you’d have been, if not off scott-free, certainly in a better position quality wise.

With a $30/mt premium milling commands over feed, which is only likely to get bigger given the amount of feed that will be on the market this year, it makes an additional spray cost of $20/ha seem like a good investment now.

Hindsight is twenty twenty vision but given how wet it was in April and into May some of us did see this coming and suggested something was done about it at the time but it fell on deaf ears.

You can take a horse to water etc.

Russia’s 2016/17 grain crop the largest post USSR

The USDA Moscow office has just released their latest summary report on Russia's 2016/17 grain production.

In it they forecasts Russia’s total grain production for 2016/17 to be 114.6mmt which will be the largest post USSR crop.

Their forecast is made up of wheat at 72.0mmt, which will be the largest wheat crop in Russian history, barley at 18.0mmt, corn 13.0mmt and the balance of 11.6mmt made up from other grain crops and pulses.

Total grain exports are forecast at 38mmt, including 29.0mmt of wheat, 4.0mmt of barley, 4.0mmt of corn and 1.0mmt of other grains and pulses.

The Russian Ministry of Agriculture October forecast puts the 2016/2017 crop at 115 to 116mmt and state that given this high amount of crop the “comfortable” volume of grain exports will be 40mmt.

As of October 12, 2016 the wheat harvest stood at 26.8mha (98%) and reached 74.7mmt which is 20% and 8% more than on the same date last year, respectively.

There is no comprehensive data on the quality of the wheat crop, but industry analysts consider that overall the quality of wheat is worse than last year, especially in the Central region where, due to heavy rains in July and August, the wheat crop lost protein.

However, they go on to say, given the overall size of the wheat crop, the quantity of good quality milling grain will not be less than last year.

Barley harvest stands at 18.5mmt (16.5mmt on the same date last year) from 7.9mha (97%).

Corn stands at 5.6mmt from 1.04mha (36%) which compares to 6.9mmt and 1.4mha on the same date last year.

The corn harvest this year is running late and what the weather does over the next few weeks will be crucial in determining how much of the outstanding crop is gathered in before conditions stop play, until the spring that is.

Industry analysts maintain that corn can be harvested for a much longer period than other grains which is true but up to a point.

Thursday, 20 October 2016

Ukraine sugar beet harvest facing an increasing challenge

To date Ukrainian farmers have harvested 119,000 ha of sugar beet, or 41% of the area sown according to the Ministry of Agriculture.

That means there could be another 170,000ha left to lift over the next six weeks which, considering they are over half way through the harvest window, could be a challenge.

It’s been wet in Ukraine recently and
farmers have been struggling to lift beet from soaking wet soils so how much of that 170,000ha gets lifted before frosts put an end to it remains to be seen.

Current yields are reported at 45.8mt/ha compared to last years crop of 42.8mt/ha.

Cereal mycotoxin levels up

Here’s an interesting story in this weeks All About Feed publication.

The Belgium feed industry, who systematically monitor raw materials for the presence of mycotoxins, found that out of 498 post-harvest grain samples tested, 64% contained at least one mycotoxin above the limit of detection.

In the 2015 the result was 34% and in 2014 this was 48%.

The Belgian Compound Feed Industry Association who conducted the survey say the increase in contamination level in this year’s harvest is the result of less favourable growth circumstances by which I think they mean it was wet.

Bearing in mind Belgium farmers achieve some top wheat yields and don’t hold back on fungicides, perhaps it indicates a quality issue currently sitting in bunkers across Europe and beyond.

I know for a fact Ukraine and Russian wheat receives next to no fungicides by comparison and it’s been a wet growing season there.

Also worth keeping in mind this survey only tested post-harvest contamination levels and mycotoxin contamination can increase during storage.

USDA annual report for Ukraine’s dairy sector

The latest USDA annual report for Ukraine’s dairy sector makes interesting reading, particularly if you’re milking cows in Western Europe.  Here’s some highlights.

Fluid milk production in Ukraine is expected to continue to decrease in 2016-17 because of a lack of foreign markets for Ukrainian dairy products, low world market prices and increased competition in the region although fluid milk production may start to stabilise in 2017 as no new market shocks are expected.

A decrease in cow number will continue a two-decade trend although accompanied by increased productivity.

Being relatively low-efficient producers, rural households use a low-cost production model with a lot of seasonal grazing and minimum usage of expensive feeds or veterinary medicine.

The quality of milk from household’s remains quite low however Ukrainian dairy processors cannot avoid using household milk due to insufficient quality (the report says quality but I guess they mean quantity) of industrially produced milk. 

In 2015, 32% of milk sold for processing came from households.

Exports of almost all processed dairy products to Russia, which was a major market for Ukraine, stopped in 2014 and is not expected to recommence anytime soon.

EU has partially opened its dairy market for Ukrainian dairy products under the Deep and
Comprehensive Free Trade Agreement.

The European Commission has cleared 14 Ukrainian milk and dairy companies as authorised exporters to the EU.

Ukrainian companies have only conducted test shipments to the EU, market development will take some time as traditional Ukrainian products are very different from those demanded by EU consumers.

Ukraine will continue to export dried dairy products and butter to utilize excess milk supply.

Industry’s efficiency will be improving due to increased investments in industrial milk production. 

Wednesday, 19 October 2016

Ukraine has harvested 48mmt of grain

Ukraine's harvest currently stands at 48.7mmt of grains from 11.7mha, or 82% of the plan, with an average yield of 4.1mt/ha.

This includes 9.8mmt of corn from 1.7mh (41%) with an average yield of 5.6mt/ha.

Sunflower stands at 10.5mmt from 4.8mha (81%) with an average yield of 2.1mt/ha and soya at 2.9mmt from 1.3mha (73%) with an average yield of 2.1mt/ha.

As of October 18, winter grains plantings stand at 5.4mha (74%), down 322kha on last year which includes 4.8mha (79%) of winter wheat and triticale and 386kha (38%) of winter barley.

Winter oilseed rape plantings are up slightly at 769kha (106%).

Russia has harvested 116mmt of grain

The Russian Ministry of Agriculture report the country has harvested more than 116mmt of grain.

As of October 18, 2016 the country has harvested 116.3mmt of grain, 13% more than the same period last year (103.1mmt in 2015) and at an average yield of 2.4mt/ha (2.4mt/ha in 2015).

Grains have been harvested from ​​44.1mha or 93.4% of the cultivated area (42.8mha in 2015) which suggests Russia’s current increase in grain output is coming from an increase in planted hectares rather than any significant uplift in yield.

Planting of winter crops for next harvest stands at 15.7mha, or 90.2% of the area target (15.1mha in 2015).

Russia has harvested 11mmt of oilseeds

The Russian Ministry of Agriculture report the country has harvested 11mmt of oilseeds so far.

This includes;
  • 7.3mmt of sunflowers (8.1mmt in 2015) with an average yield of 1.6mt/ha (1.5mt/ha in 2015);
  • 2.1mmt of soya (1.7mmt in 2015) with an average yield of 1.6mt/ha (1.5mt/ha in 2015).
  • 1.0mmt of oilseed rape (1.0mmt in 2015) with an average yield of 1.2mt/ha (1.2mt/ha in 2015).
According to a Ministry forecast the oilseed harvest is expected to reach 14.9mmt, up on last years 13.8mmt crop.

Latest USDA weather update for western FSU

Additional heavy rain in the west contrasted with dry weather in eastern wheat areas.

A slow-moving storm system produced moderate to heavy rainfall (10-90mm) over the western half of the region, alleviating short-term drought over central and western Ukraine but saturating or flooding low-lying fields.

Showers from this system (10-40mm) also spread into southern Russia, maintaining good to excellent conditions for winter wheat establishment.

Meanwhile, sunny skies promoted winter wheat development across west-central Russia.

The season’s first freeze (-7 to -1°C) was reported from Belarus and northern Ukraine into central Russia, while readings remained above freezing in primary winter wheat areas located across the south.

(This week we received reliable reports from southern Ukraine of 300m over the previous two weeks so 10-90mm might be conservative.)

Tuesday, 18 October 2016

Latest Black Sea crop update now available

The latest Black Sea Crop Update is now available to purchase, priced at $250.

In it we have summarised information collected during this seasons Russian and Ukraine crop tours which covered a combined distance of 8,625km and carried out over one thousand individual crop assessments to quantify the condition and yield estimates for corn, sunflower and soya.

The report contains information on the routes taken, oblasts covered, methodology, results of crop condition scores, yield estimates for corn, sunflower and soya and a brief discussion on the findings.

You may also be interested to hear that we are currently planning the next Crop Tour of Russia and Ukraine in November to look at the condition of wheat as it heads in to the winter.

Email me at if you would like to receive a copy of this report, sign up for the November results or would like to discuss subscriptions for next season.

Highlights from the latest USDA report for Ukraine

The latest USDA GAIN report for Ukraine has been released, here’s a few of the highlights.

All grains demonstrate higher yields as the result of favourable weather conditions.

Wheat output for 2016 is 26.6mmt, down only 2.5% on last year despite a drop in winter crop hectares.  

According to industry sources, 60% is milling grade and 40% is feed (I don’t buy that).

Barley production is 9.7mmt, up 13% on last year.

Corn harvest is in progress but expected to be up 10% on last year at 26mmt based on expanded production areas.

Wheat food consumption as well as feed consumption for all grains has been downscaled based on shrinking animal numbers, the difficult economic situation, and change in consumer preferences.

Decreased domestic consumption and lower ending stocks for grains allowed for higher exports.

Farmers are currently planting winter grains and as of October 4 had sown 3.6mha wheat, 119kha of rye and 181kha of barley 2016.

These numbers are 3-8% lower compared to the previous year.

Planting decisions made by farmers in regard to winter grains are being impacted by both economic factors (low grain prices) and weather conditions (dry soils at end September, wet soils by mid-October).

Monday, 17 October 2016

Latest Ukraine agri-business news

Ukraine's President Petro Poroshenko has signed a financing agreement with the European Investment Bank (EIB) on issuing EUR400 million of loans for agriculture projects, specifically grains and oilseeds, fisheries and aquaculture.

The EIB loans can account for up to 50% with the other part coming from banks participating in the lending program which might be a problem as Ukraine banks are not all that keen on lending money particularly to smallholders.

USAID has agreed a new technical assistance project worth more than USD20 million to support small-scale farming in Ukraine.  The new four-year project is aimed at increasing the competitiveness of Ukraine's small and medium-sized farms by supporting reforms in the agricultural sector aimed at improving the business environment and attracting investment.

Not entirely sure what that all means but they do go on to say that, as a part of the initiative, Ukrainian vegetable, fruit, milk and meat producers will receive technical assistance on international standards of quality and safety and entering export markets.

The European Commission has adopted a proposal to give Ukrainian producers access to the EU market for a range of agricultural products by temporarily raising tariff quotas for three years.  This is on top of the preferential tariff-rate quotas already in place.

Ukraine’s Ministry of Agricultural estimate an additional EUR200 million of agricultural products could be shipped to the EU markets as a result and I see no reason why preferential treatment by the EU towards Ukraine will not continue as the EU looks to support Ukraine economically and politically.

Given that the EU account for 80% of UK wheat exports and 63% of barley exports this potentially leaves UK farmers in a very tenuous position depending on how hard Brexit negotiations turn.

Latest Russian agri-business news

Russian Ministry of Agriculture report that from January to October 2016 farmers purchased 13% more mineral fertilizers compared to the same period last year, driven in part by an increase in hectares planted but also a 2-3% drop in fertiliser prices.

The total amount of credit supplied to Russian farmers for seasonal fieldwork is up to 261 billion roubles, which is 28.7% more than the same period last year.  This includes Rosselkhozbank who issued 190.38 billion roubles in loans (+34.5%) and Sberbank who allocated 70.62 billion rubles (+15.5%).

Total Russian grain exports for market year 2016-17 is forecast at 37mmt including an increase in wheat export to 28mmt from 24mmt.

Last week Egypt bought 60kmt of Russian wheat and secured another 120kmt from Romania, no mention of ergot at this point but given the wet season that might only be a matter of time.

Syria's state grain buying agency has agreed to buy 1mmt of Russian wheat following a poor harvest in the region although there is some question over whether this is part of an aid package as the price is low and would be difficult to fulfill as a commercial trade.

The Russian government finally reduced export duty on wheat to zero but retained an element of uncertainty by saying that it will return in the case of a force-majeure such as the devaluation of the rouble or low wheat yields.

Russian import substitution is turning into exports according to Pravda who report that the country will produce a 1mmt surplus of sugar in 2016 which, for the first time ever, could be exported assuming they can get it all out of rain sodden fields.

Friday, 14 October 2016

Ukraine harvest update

Ukraine Ministry of Agrarian Policy report the current harvest stands at 46.6mmt, down slightly on the same period last year (47.2mmt in 2015).

To date 11.4mha or 80% of the cropping area has been cut but wet and windy weather this week has slowed or stopped harvest with reports of damaged and lodged crops in the south which will undoubtedly lower final harvest output.

Winter crop plantings stand at 4.8mh or 66% of the reported target area, down 383kah on the same date last year.

Some of my contacts are suggesting they will stop planting anymore winter wheat as a result of the wet weather so it will be interesting to see how close to the target planting Ukraine gets to this year.

Russian harvest update

Russian Ministry of Agriculture report the country has collected 115mmt of grain, 13% more than the same period last year (102mmt in 2015).

Yield is up at 2.6mt/ha compared to 2.4mt/ha last year which reflects the good growing season experienced this year.

As of October 13, 2016 in the country had combined 43.8mha, up 1.3mha on the same point last year.

Consequently while some of this additional yield is coming from an increase in the tons per hectare gathered, the bulk is coming from more hectares cut.

Winter crop plantings currently stand at 15.1mha or 86.9% of the reported target area (14.8mha in 2015).

Thursday, 13 October 2016

Latest USDA weather update for western FSU

Heavy rain in the west contrasted with warm, dry weather in central and eastern wheat areas.

A stationary storm system produced moderate to heavy rainfall (25-110 mm, locally more) from Belarus and northwestern Russia into central and southern Ukraine.

The wet weather eased or ended short-term drought over central and western Ukraine and improved prospects for winter wheat establishment.

However, flooding in low-lying fields may necessitate replanting winter wheat or waiting for spring to plant warm-season crops.

Meanwhile, sunny skies and late-season warmth (3-7°C above normal) promoted winter wheat development from eastern Ukraine into central and southern Russia.