Traditionally, representing to your attention a brief overview of the world and Ukrainian agrarian sector news.
According to the bylaw of September 29, 2019 No. 882-r, the Cabinet of Ministers of Ukraine, as part of one of the ways to reduce the cost of loans for farmers, provides for partial compensation of the interest rate on the credit and the amount of the credit for the purchase of land. Thus, the Government approved the conceptual directions for cheapening loans to agricultural producers for the purchase of agricultural land after the opening of the land market.
The Verkhovna Rada of Ukraine adopted in second reading and, in general, Law No. 1056-1 on the protection of property rights. The law introduces mandatory notarization of contracts for the alienation of corporate rights and terminates the activities of accredited state registrars. The explanatory note to the bill notes that responsibility for violations of registration procedures is also being increased and the principle of simultaneity of notarial acts and state registration of rights is being introduced.
Prices for Ukrainian sunflower remain under pressure from low demand and a significant harvest, although they receive support from stable prices for sunflower oil due to the rise in price of palm oil. Prices for supplies of Ukrainian sunflower oil in November-December remain at the level of $ 680- $ 690 per ton FOB, but India, which is its main buyer, reduces demand. Plus this year there is a threat to the demand for sunflower oil, and with it the prices for sunflower, which may come from the soybean market. Traditionally, sunflower prices in Ukraine are seasonally at low levels from the start of the harvest to the end of December. After that, the sales shaft decreases, and the demand for processed products grows.
In September 2019, in Ukraine, the production of vegetable oil increased by 8.8% compared to the same period last year. The growth in the production of unrefined sunflower oil amounted to 5%, refined sunflower oil – 34.2%, soybean oil – 22.3%, rapeseed oil – 96.7%.
Corn prices fell sharply after the release of the USDA report. The decrease in prices was due to the fact that USDA experts in their October report raised the forecast for corn yields in the US in the current season to 168.4 bushels / acre against 168.2 bushels / acre according to the previous estimate, while market operators expected this indicator to decrease to 167 5 bushels / acre. In addition, pressure on prices was exerted by a decrease in the forecast of US grain exports in the current season by 3.5 million tons to 51.5 million tons.
Wheat prices have fallen again in Chicago, as American origin is too expensive to be competitive in the international arena. The world wheat crop is projected at 30 million tons more than last year. Corn prices remained virtually unchanged, while soybean contract prices rose due to China’s offer to provide an unlimited quota for the purchase of 10 million tons of soybeans from the United States.
In Ukraine, there is a tendency to increase grain exports. Since the beginning of 2019/20 MY, as of October 11, 2019, Ukraine has exported 15.1 million tons of grain and legumes. This indicator is 4.6 million tons higher than the result for the same period last year.
In Ukraine there is a proposal offer to increase rent and land tax. In parallel with the free land market, it is necessary to increase the rent for 1 ha of agricultural they land and the amount of land tax. The leaders and representatives of local authorities and the OTG voiced such an initiative at a meeting on land reform issues with the head of the agrarian committee.
Since 1998, 64 new enterprises were built in Ukraine, including 48 powerful oil extraction enterprises, 16 oil transshipment terminals (up to 90% of the volumes are transported by sea), more than $ 3 billion of investments were involved, and enterprises are modernizing. According to the expert, oilseed processing capacities in Ukraine increased from 2.5 million tons in 1998 to 22 million tons at the beginning of 2018, or 8.8 times.
With kind regards, team of GC “Agroliga”.