The amount of cash inflows from Ukrainian corn exports decreased by almost a third during the last five years

15:21 | ProAgro

For a long time corn remains one of the key components of Ukraine"s agro-industrial exports. In 2016, 17.29 MMT of legumes were delivered to external markets and the amount of currency from these sales reached $2.65 billion (according to the State Fiscal Service of Ukraine). According to the information of the department, this value corresponds to 7.3% of the total export of goods and services from Ukraine by the end of the year.

It is worth to mention that the average corn prices on world trading floors demonstrate a decline in recent years, which is a consequence of the global trend of overproduction of this crop. According to ProAgro, the average annual export prices (FOB) for corn of Ukrainian origin in 2012-2016 decreased by more than a third. This trend is reflected in the volume of revenues from external shipments of Ukrainian corn. As can be seen from the data in the table above, with comparable volumes of exports of such products in 2014 and 2016, the amount of currency decreased by 1/5. The revenue from external shipments of such products in 2016, compared with 2012, decreased by 32%.

According to the USDA, the global corn harvest as a result of MY 2016/17 will amount to 1053.76 MMT, exceeding the similar indicator of the 2012/13 season by more than 20%. The growth of global consumption can not absorb the additional volumes of consumption that arise in this way, which leads to a permanent increase in the transitional stocks of culture by the end of the season. If by the end of MY 2012/13 such reserves were estimated at 133.18 MMT, then at the beginning of MY 2017/18 they are expected to reach 222.98 MMT, which will continue to keep prices from rising.

At the same time, Ukrainian farmers are likely to increase the volume of corn production and exports in MY 2017/18. According to the latest USDA Ukraine report: Grain and Feed Annual, corn yield in the coming season could reach 28.7 MMT (against 28.1 MMT in MY 2016/17). The volume of export is forecasted at the level of 21.5 MMT, which exceeds the estimated value for MY 2016/17 by 7%