1/ Trade year statistics are on July/June years. For corn Marketing Year beginning October 1 but here trade year statistics presented in the same way as for other grains.
2/ Excludes millet exports.
3/ Preliminary data
*Forecast

Ukraine has extended its presence in the wheat and barley export markets. The August grain exports rose several times comparing with previous months and appears to exceed peak December 2001 exports.

Around 1.28 million ton of grains, legumes, wheat flour, and bran reported to be exported in August 2002 (versus 270 ths mt in July 2002 and 476 ths mt in August 2001) including 816 ths mt of wheat and 391 ths mt of barley.

Since May 2002 and up to July 2002 grain export shipments were within limits of 325 ths mt. Last Marketing Year shows us a record level at 1.23 million ton for all grains and around 750 ths mt for wheat shipments. Last year peak grain export shipments fell on December (for wheat on October).

Ukrainian peas export in August essentially increased to 42,400 MT (versus 7,100 MT a month ago).

At the same time, buckwheat and wheat flour exports continue looking weak. In August of 2002 only 62mt of Ukrainian buckwheat (lots amounting 40 and 22mt went to Slovenia and Belgium) representing the old crop and were shipped. Such poor buckwheat exports show that this commodity reached its seasonal deficit on the domestic market. Ukrainian wheat flour export market was more died than alive with its mere 4mt of export trade.

However, internal market prices didn’t go upward in response to increased shipments as big resident exporting companies had bought considerable volumes of grains from local farmers before harvesting. It quite frequently happened that wheat and barley were delivered to the Black Sea ports directly from the fields. Towards the end of August ports reported to be overloaded.

The main export shipments of grains in August 2002 were made to fill the markets of North Africa and Middle East (Israel, Saudi Arabia, Tunisia, Morocco, Algeria, others) and those of southern Europe (Spain, Italy, Portugal). So far Spain is still the largest buyer of Ukrainian grains this season mainly because of lowered import duties for low graded wheat into EU. Past August about 350,000mt of grains were shipped with the destination Spain, whereas shipments with the destination Portugal and Italy showed 46,000mt and 30,000mt accordingly. Saudi Arabia procured over 180,000mt of Ukrainian grain (barley exclusively). Morocco, Algeria and Tunisia cumulatively purchased 187,000mt of grains and almost 37,000mt went to Mauritania. Above 150,000mt of grain was shipped to Israel.

Rather large shipments were made to South Korea and Canada (86,000mt & 43,000mt accordingly). The latter having faced poor grain yields have now turned into feed grains importer on the world market. Shipments for Syria and Libya were slightly over 32,000mt. About 14,000mt of grains went to Japan. Hopes for shipments to Brazil did not prove realistic – the volumes shipped in August were even smaller than in July. Our outlooks for Ukrainian wheat shipments to Brazil show that September should bring certain growth.

We expect September grain export shipments to surpass those in August and to reach 1.29 mill mt including 850 ths mt of wheat. Forecast is based on current shipments and improved transport infrastructure (new grain terminal in the Ilyichevsk port). However, we do not expect the Ukrainian ports to work at full capacity because of operation failures and local railway congestions.

Wheat exports accounts for two thirds of all grain exports. Around 816,000mt of wheat including 808,000mt of soft wheat are estimated to be exported in August 2002. In general, this exports consist of feed wheat and low- and medium-quality milling wheat.

The Augest export shipments were so intensive that became a record breaker for monthly wheat exports in 2001/02 MY (around 700,000mt shipped out in October 2001). This happened due to both better-prepared exporters and expanded port capacities.

Vessel loads were registered mostly for southern Europe, North Africa, and Near East. South Korea made a massive purchase of feed wheat as well. Negotiations were under way to organize shipments to North America (Canada).

As a result of seasonal fall of domestic prices and escalation of feed shipments, the total wheat export price range dropped on the average by more than US $10/mt showing $72.70/mt СРТ/DAF/FOB Ukraine. Soft wheat (excluding seeds for sawing) was purchased by foreign buyers at an average price ranging US $72.50/mt, hard wheat – at US $86.00/mt СРТ/DAF/FOB Ukraine.

Seed trade amounts 378mt of soft seed wheat that was shipped to Armenia priced at $230.42/mt DAF Ukraine.

Spain and Israel still remain the leading buyers of Ukrainian wheat. In August the largest export shipments went to Spain (322,000mt or 39,4% of total monthly exports at an average price of US $70.50/mt CPT/FOB Ukraine), Israel (112,000mt or 13.7%, at US $73.20/mt CPT/FOB Ukraine) and South Korea (86,000 ths. mt, or 10.6%, at US $70.65/mt CPT/FOB Ukraine). Above 30,000mt were shipped to Portugal during the month in review (46,000mt or 5.6%, at $71.00/mt CPT/FOB Ukraine), Canada (43,000 mt or 5.3%, at $72.60/mt CPT/FOB Ukraine) and Mauritania (37,000mt or 4.5%, at US $69.05/mt CPT/FOB Ukraine).

Vessels ranging 10-30 ths mt with soft wheat went to Morocco, Algeria, Italy, Tunisia, and Nigeria. 11,500mt of wheat including 800mt of hard wheat was delivered by rail to Estonia.

Hard wheat was shipped for the most part to Brazil (3,300mt at an average price $95.15/mt CPT/FOB Ukraine) and Tunisia (2,800mt at $83.50/mt CPT/FOB Ukraine).

Market operators say that as volume of shipments increased, the alignment of forces amongst Ukrainian wheat exporters became very similar to that of 2001/02MY for the whole season.

In August well-known Ramburs and Cargill broke off having shipped according to traders’ data, over 50,000mt each.

A noteworthy fact is that two state JS Energy companies and Odessa port elevators joined the top 20. Other companies worth paying attention to are: JV Nibulon and Mykolayiv-Agro, which increased shipments and maintained their positions of leading local exporters of wheat from Ukraine. Eurotech was rather active in August too. Positions of Burat and Vinnytsiakhlib grew much stronger.

Traders said that W.J. Grain Ltd remained the largest foreign buyer of Ukrainian wheat, followed by a number of world famous corporations. An Estonian Evervelle being the single FSU representative closes top twenty.

It is hard to make any more comments here. So, let’s concentrate on how foreign markets are divided between large international corporations dealing with Ukrainian wheat.

Thus, W.J. Grain Ltd. continued shipping in the direction of Spain. No August shipments went to Israel; nevertheless there started massive shipments to Portugal, Morocco, and Mauritania. Certain volumes were also shipped to Algeria, Albania, and Hungary.

It should be noted that almost all companies in the top 10 list (except for Nidera) left their marks in the south of Europe. Nidera Handelscompagni B. V. Continued shipping to Israel. Thus, United Agro Industrial Ltd. shipped solely to the south of Europe (namely Spain and Portugal), whereas United Grain Trading S.А. – to Spain, Israel, Nigeria and South Korea.

Glencoree International continued making deliveries to Algeria, but also delivered to such countries like South Korea, Switzerland, Japan and, of course, to the Europe’s south – Spain. It is worth while stating that the main volume of wheat shipped to Japan was contracted not by Glencore but by a US offshore Kernel Trading Company LLC. We paid a special attention to the shipments going to Japan and Canada because the above directions are rather exceptional for Ukrainian wheat. These markets are being familiarized with due to poor yields in Canada and Australia coupled with decreased US export capacity. Contracting involving shipments to Canada were handled mostly by such US based companies as (I W Maxi-Trade, Kernel Trading Company and Hillcroft) plus British (Ronly Holdings Limited and Yurol UK Ltd.).

Further on, Cargill intensified its shipments to Spain and Algeria and was the exclusive supplier of Ukrainian wheat to Egyptian market. Louis Dreyfus Negoce continued shipping towards Morocco and Brazil, while the largest shipments in August fell on Italy and Tunisia. Contracting was under way for South Korea and small volumes were purchased for Spain.

After a time out, Soufflet and Mark Man reappeared and gained solid pace right away. Both companies contracted wheat for further shipping to Spain whereas Soufflet Negoce S. A. kept shipping to Mauritania and the other one – to South Korea.

It is a possibility, that in the coming months Ukrainian wheat exports will be kept high and there are chances that August shipments’ record will be replaced with a new one. We expect September exports to be around 850,000mt, mainly of soft wheat of low- and medium-quality. Forecast is based on current shipments and expanded port capacities.

Prices are on averaged exporting basis CPT/DAF/FOB Ukraine.

Prices are on averaged exporting basis CPT/DAF/FOB Ukraine.

Ukrainian coarse grain export (barley, corn, rye, oats, millet, and sorghum) in August increased 331 ths mt from the month earlier to 426 ths mt mainly due to a increase in barley shipments that amounts one third of all grain exports and over 90% of monthly coarse grain exports. The August barley exports exhibits a sudden upward jump of 326 ths mt to 391 ths mt.

The August corn export, which amounts 23,600mt, is practically unchanged from July. Zero exports in the last quarter of the season used to be typical. What is more, if in the past Ukrainian corn was sold to neighboring CIS countries, now it is shipped to North Africa.

In August 2002 Ukrainian oats were not exported to speak of on the background of other more attractive grains and as a result oats exports look rather weak. A mere 5mt of this commodity was exported during the month in review versus 3,400mt in July of this year. On the other hand, this goes in line with the same period of the previous year or in the past season. In July-August of the previous year few metric tons of oats were exported totally.

August 2002 indicators for bran exports came back to the level of June that is dropped 1.5 times over July. During the month in review 6,400mt of bran totaling almost US $410,000. The average price of export shipments decreased by $3,85/mt on a month and showed $63.95/mt CРТ/FOB/DAF Ukraine.

Reduced bran export volumes we explain through seasonal production shrunk in Ukraine in the end of the season and increased competition from grains on the markets of buying countries.

Saudi Arabia appears to be the main barley purchaser with shipments that amounts almost a half of the August barley exports. Egypt remained being the main buyer for Ukrainian bran even reducing its purchases in August (approximately by 300mt) down to 3,600mt.

Export market of barley in August revived noticeably as a result of seasonal increase of domestic supply and decreased local prices. During the month in review (August 2002) Ukraine shipped for export 391,000mt of barley totaling US $30.1 mill.

Export prices continued their seasonal declining where average barley export price dropped by US $2.3/mt on a month over July down to US $77/mt CPT/FOB/DAF Ukraine.

Demand of Near East and North Africa countries for Ukrainian barley grew stronger. As we anticipated, no Ukrainian barley as shipped to southern Europe – European barley proved to be more competitive on the domestic EU market. At the same time, Ukraine attracted new and unexpected buyer – Japan which consumed over 9,000mt of the said commodity.

The list of major countries importing Ukrainian barley was headed by Saudi Arabia (180,000mt or 46% of all exports of the said commodity during the month in review at an average price of US $77.9/mt CPT/FOB Ukraine) followed by July’s leader (48,500mt or 12%, at US $78.75/mt) and Israel (40,400mt or 13%, at US $77/mt). Considerable volumes of barley shipments headed to other countries of North Africa and Near East.

The leaders on the list of major barley exporters were Serna, Ramburs, and Cargill.

Market operators inform that amongst foreign counter-agents in August the most active shipper was Glencoree International, which sent over 100,000mt of barley to Saudi Arabia. Glencore was followed by a solid gap by Cargill (shipments to Tunisia and Algeria). W.J. Grain Ltd. (shipments to Morocco and Syria) remained on the third position of our rating, whereas Farm Trading Ltd. (shipments to Syria, Libya and Algeria) fell down to the fifth position. In-between you will see Nidera Handelscompagni B. V. (shipments to Israel and Morocco).

We forecast further escalation of barley exports from Ukraine first and foremost due to increase in prices and demand from the world market. The predominant shipments will continue heading towards North Africa and Near East.

August export shipments of corn met the level of such exports in July and slightly exceeded the latter. During the month in review (August 2002) Ukraine exported 23,600mt of corn totaling US $2.25 mill (whereas a month ago this indicator was 21,500mt and US $2.0 mill accordingly). In the end of the season the export was supported by high gross yield of past year and low domestic demand with domestic prices being relatively low.

Moreover, the average export price grew up to US $95.5/mt (in July it was – US $91/mt) CPT/FOB/DAF Ukraine, which for the most part is caused by increased number of vessel shipments.

Thus, in August over 60% of exported corn headed to Tunisia. In this direction the price was a bit higher or US - $98.4/mt CPT/FOB Ukraine. Let us remind you that a month ago almost 5,000mt of corn was shipped to Lebanon.

In other words, alternative markets for Ukrainian corn are being looked for and this gives hopes to local farmers that export demand will get stronger and in its turn could support domestic prices.

Volumes of shipments to Belarus dropped down from 8-9 ths mt monthly (June-July) below 4 ths mt in August. Prices for the said destination continued to grow – by US $1.2/mt reaching US $94.23/mt DAF Ukraine. 3,600mt of corn went to Russia at an average price of US $88/mt DAF Ukraine.

Traders declared that contracting of corn to be shipped to Tunisia was performed by United Grain (Suisse) S. A., thus explaining its leadership amongst the foreign buyers.

EcoMol and Krupskaya Minsk Poultry Farm were among the most active amongst Belarus companies (including through Russian companies – financial intermediaries). Amongst Russian buyers one should have noted Yaroslavl Starch and Syrup Plant and Kurskiye Korma (or Kursk Feed) which, if truth were told, purchased Ukrainian corn through other Russian companies rather than doing this directly.

We do not forecast large volumes of corn exports from Ukraine, as in most probability such shipments will make up around 15-25 ths mt in September. October shipments to Baltic states and Belarus may revive especially when new crop corn will get to the market.

Rye export market looked more active compared to a year ago but was still inferior to that of the second half of the past season. Spain joined Estonia previously being the sole buyer of Ukrainian rye in August due to reduction in EU import duties for rye first of all. No matter EU abundant stocks of rye, Spain purchased 6,400mt of rye from Ukraine because prices for Ukrainian commodity are more attractive - US $71.41/mt FOB Ukraine. 3,500mt were shipped to Estonia at an average price exceeding that of July by almost $2/mt - $59.93/mt DAF.

Cumulative Ukrainian rye exports in August made up almost 10,000mt at an average price being $67.35/mt FOB/DAF Ukraine.

Traders state that in the month of August the highest interest in Ukrainian rye was shown by Mark Man (UK) Limited (Cyprus), United Milk Group Corp. (USA), and Estonian Rakvere Viliasalv.

August 2002 brought some additional activity to millet exports although lagging behind the previous season becomes more obvious. In August 2002 foreign buyers obtained 1,400mt of millet totaling US $117,000 (a month ago it was 493mt totaling US $50,200). Cumulatively in July-August 2001 Ukraine exported 4,300mt of millet. Decreased exports over past year’s indicators is for the better part tied to massive shipments of other grains to foreign markets. Exporters’ preferences were wheat, barley and peas.

Millet prices growth noticeable in the second part of the past season and in the very beginning of the current one, stopped and prices plummeted down facing the competition from other grains. Price decrease is characteristic for this time of the season, although there might be some escalation with shipments going sharply down (under such circumstances prices are not representative).

In August the average export millet price was US $81.8/mt (a month ago – US $101.6/mt), DAF/CPT/FOB Ukraine.

Unlike other periods, in August shipments of Ukrainian millet to the Baltic States were not registered and shipments to Eastern Europe slowed down noticeably. In particular, 66mt were shipped to Poland and 44mt – to Hungary.

The largest shipment headed to Netherlands (1,300mt or 91% of all export volumes in the month of August at an average price of US $77.60/mt CPT/FOB Ukraine).

Market operators declare that Hungarian W. J. Grain Ltd., which in fact made deliveries to Netherlands, contracted the lion’s share of August millet exports.

Ukrainian farming operations Lana (Zaporizhzhia Oblast) proved rather active in shipping railcar lots to neighboring countries of Eastern Europe and Russia.

In the whole, millet exports from Ukraine is maintained on case to case basis due to lack of stable markets which in its turn makes forecasting of shipment dynamics difficult.

Prices are on averaged exporting basis CPT/DAF/FOB Ukraine.

The successful start of the export season for peas showed up and developed in August. During the said month exports made up 42,400 mt of peas (seeds for sawing were not shipped out) mostly of feed quality which is more than just a monthly record for at least during a couple of previous years. It also comprises about 37% of the total export in preceding 2001/02 MY when this commodity exports were rather high. And all this takes place on the background of reduced peas production in Ukraine in 2002!

Traditionally our expectations for peak shipments were set for September – October, however, this season due to earlier harvesting campaign, lower gross harvest and higher activity of peas exporters in the beginning of the season (one had to bring peas to the ports on the timely basis before massive shipments of wheat and barley commence) such peak should be expected at a later date, say in August-September. However, it is a big probability that in September the volume of shipments will be lower than in August and after that peas export will go downhill.

South European countries were traditional leaders in purchasing Ukrainian peas. Almost half of all exports in August were made to Spain (20,700mt or 49% of the monthly shipments at an average price of US $106.6/mt CPT/FOB Ukraine), and almost 1/5 of total shipments were made to Italy (8,100mt or 19% of monthly shipments at an average price of US $111.2/mt CPT/FOB Ukraine) (hereinafter we quote an average price based on export shipment terms). Rather large shipments were registered to India (7,700mt) and Netherlands (4,400mt). Shipments to Netherlands showed higher prices as peas shipped to the said country were of food grade.

Export prices for Ukrainian peas in August grew considerably over July which for the most part was the result of increased share of better quality peas in the total monthly volume of shipments. The average export price for the commodity grew from US $112.10/mt in July to US $123.90/mt in August, СРТ/DAF/FOB Ukraine.

The data received from traders show that the largest volumes of peas exports were registered at Odessa Cognac Distillery (such are the peculiarity of Ukrainian taxation), Dniprovska commercial and industrial association and two Kyiv based companies Leks and Adora.

Amongst the foreign buyers Hungarian W.J. Grain Ltd took leading positions. And French Soufflet Negoce S.A., with their shipments to Spain. Rather extensive volumes to be shipped to Spain as well were purchased by Wellmix L.L.C., Vectra Associated Limited and Louis Dreyfus Negoce S.A., British E.W.Trading Limited contracted over 5,000mt to be shipped to India.

Prices are on averaged exporting basis CPT/DAF/FOB Ukraine.

Ratings are based on survey of traders. The position of each company in the ratings that are given above is the opinion of “ProAgro” (and/or its respondents) only. We do not provide any information with regard to the companies involved. We apologize for spelling mistakes in the companies’ names if any.