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Helping to cut food inflation, no area in Ukraine is threatened by drought this summer,

Tetyana Adamenko, head of the agro weather department of Ukraine’s Hydrometeorological Center, told Interfax-Ukraine yesterday. “The situation is very good, the soil is an excellent source of moisture,” she said, citing a key factor for crops. “There are almost no areas threatened by drought, which is unusual for Ukraine in the last decade.”

China’s growing appetite for wheat and soybeans, a severe drought in Brazil,

growing demand for vegetable oil for biodiesel, and supply chain disruptions caused by the pandemic were cited last week by the Financial Times as reasons for rising food prices. “The drought in Brazil turned out to be worse than everyone expected,” FAO senior economist Abdolreza Abbassian tells the FT. “Therefore, it remains to pray that the weather in the United States is good.”

Two thirds of Ukraine’s farmland is at risk of drought due to climate change,

Ukraine’s Agriculture Minister Roman Leshchenko told the Ukraine 30 Ecology forum yesterday. “Climate change is taking place and in fact two thirds of our territory is becoming a zone of risky agriculture,” he said. “Especially critical points are July-August.” Farmers should shift to low till, low chemical techniques that use harvesters that shred crop residues, returning them to the soil. Six million hectares, largely in southern Ukraine, urgently need conservation, he said.

After last year’s drought caused up to $4 billion in crop losses to southern farmers,

 the Agriculture Ministry is launching a pilot project to restore irrigation systems in Odesa, Kherson, Mykolaiv and Zaporizhia regions. Minister Leshchenko writes on Facebook: “We will rebuild and expand reclamation systems with private and public capital.” Two weeks ago, land reclamation responsibilities were returned to the Ministry of Agriculture.

During the 20-year ban on farm land sales, Ukraine’s state has lost the equivalent of “almost two Crimean peninsulas,” to land thefts by “businessmen and politicians,”

President Zelenskiy said yesterday at Ukraine 30, a land forum. About 5 million hectares of state land moved illegally into private hands, he said. Crimea’s territory is 2.7 million hectares. During the land sale moratorium, 7 million rural residents were deprived of full ownership rights, and 1 million died, often in poverty, unable to sell their land, he said.

On July 1, a limited farm land market is to open. Sales only are allowed among Ukrainians and the limit is 100 hectares.

In advance of this modest opening, farm land rents increased 6.5% yoy in 2020 to an average of 3,380 hryvnia/hectare, Ellina Yurchenko, a farmland expert for the Ukrainian Agrarian Business Club said in a press release Friday. At the Forum, Timofei Milovanov, president of the Kyiv School of Economics, said that by allowing farmers to borrow against their land, the market will result in higher yields, greater productivity and an extra $2 billion in tax revenues.

China’s Ambassador to Ukraine Fan Xianrong said that Chinese companies should invest in farming and processing food in Ukraine,

 Xinhua reports from an online forum held Tuesday: “Ukraine-China: The Future of Trade, Pulses, Grains, Oilseeds.” Fan notes that Ukraine’s food exports to China jumped 84% yoy, accounting for 45% of Ukraine’s total exports to China. Due to exports of food and metals, China is Ukraine’s largest trading partner.

Ukrainian food exporters should take advantage of a projected 24% jump in Chinese food consumption by 2024

, Oleh Sytnyk, the President of the Ukrainian-Chinese Friendship Society, said yesterday at another China-Ukraine food conference. Due to urbanization and growing incomes, “more and more Chinese families can afford quality European products,” he said, Ukrinform reports from the forum which was organized by the Chamber of Commerce and Industry of Ukraine.

Auctions of state or communal farm land will now take place openly through electronic auctions conducted on the Internet,

under a bill adopted yesterday by the Rada. “Anyone with a computer and Internet access will be able to take part in the auction,” (Interfax-Ukraine). “According to the ministry, the winners of the bidding will be those who offer the highest price per lot.” Plot sizes are limited to 20 hectares and buyers are limited to Ukrainians.

“In addition these new markets, Ukraine now exporting 63 commodity items to 11 states and international economic organizations.

The first being exports to CIS countries which are now subject to new trade rules that come in force from April 13, 2021 in the field of veterinary medicine.  This has replaced an agreement between CIS countries which was signed back in 1993. Also, due to changes in the terms of trade, new agreements were  renegotiated with Singapore and South Korea,” said a government spokesperson.

This spring’s cool, wet weather will boost grain harvests by 14.5% and exports by 28%,

the Ukrainian Grain Association predicted yesterday. In reality, this would return Ukraine to the bumper year of 2019/2020. Looking ahead, corn exports are to jump 27% in the coming marketing year, to 30 million tons. Wheat exports are to increase by 37%, to 21 million tons. The sunflower harvest is to increase by 28%, to 16.5 million tons, slightly more than the 2019/2020 level.

Ukraine increased its exports to China during the first two months of this year by 44% yoy,

 Taras Kachka, Ukraine’s Trade Representative, said after meeting with China’s ambassador Fan Xiangong. Overall, Ukraine’s trade rose 18%, to $2.5 billion, with China, the nation’s largest trading partner. One focus of the meeting was to expand the access of Ukrainian food product to the Chinese market. Food accounts for 53% of Ukraine’s exports to China, reports Ukraine’s Economy Ministry.

The snow and frost that hit central Ukraine during the night of Sunday to Monday will not harm harvests

, said Tetyana Adamanko, the Head of Agrometeorology at the Hydrometeorological Center at a farm associations meeting yesterday. Due to the late spring, seedlings can easily withstand the air temperatures that fell to -3C, she said, (Ukrinform). By contrast, the wet cool spring has resulted in one of the best moisture penetrations of the soil in 20 years. Ukrinform concludes: “The situation with winter cereals looks extremely optimistic.”

The first of seven state-owned flour mills is to be privatized through auction on May 7

, the State Property Fund reports. Often called ‘bakeries’ these Soviet-era complexes mill wheat and corn into flour and animal feed. Located alongside railroad tracks, the seven ‘kombinats’ have elevators with a total storage capacity of 634,000 tons, about 1% of the nation’s total. Of the seven going up for sale, four are working and three are nonworking. The first auction will be of a working one, Dunayevets Bakery in Khmelnitsky Region. The starting price is $6.7 million.

Ukraine could double and even triple grain exports to China,

said Mykola Gorbachev, the President of the Ukrainian Grain Association after signing a cooperation agreement with China’s Association of Small and Medium Enterprises. Noting that Ukraine already has exported 10 million tons of grain to China since June, he said: “Today, the lion’s share of grain exports to China is corn and barley.” The next step is to sign bilateral sanitary agreements with China for “wheat, sorghum, peas and other crops,” he said. The two groups agreed to establish a Sino-Ukrainian Council

The US will displace Ukraine as China’s top source of corn this year

as predicted on the China’s Global Times news website. In the first two months of this year, China’s corn imports increased by 414% yoy, to 4.8 million tons. The US pulled ahead of Ukraine, largely due to the Trump-era US-China trade accord. With the marketing year ending June 30, the US Department of Agriculture has predicted that China will import a record 24 million tons of corn.

Ukraine’s grain exports are down 35% yoy as of last Friday,

according to data provided by the Economy Ministry. Drought depressed harvests, lead to the export drop. High food prices worldwide have ensured that Ukraine’s agricultural earnings have taken a smaller hit. Agriculture is Ukraine’s largest source of exports, generating 9% of the country’s gross domestic product in 2019, according to the International Trade Administration, (USA).

Ukraine’s grain exports could rebound by 19% in the upcoming marketing year, reaching 54 million tons,

predicted APK-Inform, the agriculture consultancy. Ukraine could export: 29.50 million tons of corn; 20 million tons of wheat; and 4.3 million tons of barley. In the last decade, Ukraine more than quadrupled its wheat exports, reaching a volume of 17.5 million tons last year. Today, Ukraine accounts for almost one tenth of global wheat exports.

Ukraine, the world’s largest sunflower oil exporter, is expected to increase sun oil exports by 17% in the upcoming marketing year, to 6.5 million tons.

With cooking oil price hikes pushing up Ukraine’s March inflation, the Economy Ministry and the Ukroliyaprom Trade Association agreed Monday to limit sunflower oil exports to 5.38 million tons in the marketing year that ends August 31. Due to high cooking oil prices worldwide, Ukraine’s sunflower oil sales in calendar year 2020 were $5.3 billion, a 24% increase over 2019 sales.

The EBRD is lending the hryvnia equivalent of $65 million to Datagroup, a fast growing telecommunications company, to buy Volia

, Ukraine’s leading pay-TV and cable broadband service, the bank announced yesterday in a press release. With a majority of shares owned by the fund, Horizon Capital, Datagroup calls itself a leading provider of fiber-optic infrastructure and digital services in Ukraine. Matteo Patrone, EBRD’s Regional Managing Director, sad: “The merged entity will invest in better infrastructure, innovation and excellent customer service.”

The EBRD is also lending $57 million to the Kernel Group to improve the storage, transportation and export of agricultural commodities

, the bank reported in a press release. The loan is part of a $200 million syndication arranged by French investment bank Natixis for Kernel, the world’s leading producer and exporter of sunflower oil. The EBRD announced: “The new financing will help the group enter the new harvest season with sufficient working capital to buy crops and prepare them for export, making full use of its newly expanded infrastructure.”

UMG Investments plans to build a $150 million grain terminal at the Pivdennyi port, Ukraine’s busiest port on the Black Sea.

The terminal will be capable of handling 9 million tons of grain a year, which equates to 20% of Ukraine’s current exports.  The terminal is expected to be completed by 2024, said UMG CEO, Andrey Gorokhov, during Strategy Council’s Ukrainian Transport Infrastructure Week. Gorokhov said: “The land has been bought. The project has been completed. The only thing left is to build it.” UMG is part of Rinat Akhmetov’s System Capital Management or SCM.

Agroholding Astarta, Ukraine’s largest sugar producer, increased its EBITDA by 45.6% to €113.4 million.

The company increased its sugar EBITDA 9-fold, to €80.2 million, by selling one unprofitable sugar mill and by cutting sugar exports by 29%. Sugar prices were higher in Ukraine, where the company has a 20% share of the market. Astarta has five sugar factories, a land bank of 220,000 hectares, dairy farms with 22,000 head of cattle, seven elevators, a biogas complex, and a soybean processing plant.

Beyond “ensuring Qatar’s food security,” Ukraine is discussing using Qatar as a logistics hub to supply food to the region,

said Ihor Zhovkva, Deputy Presidential Chief of staff, (Ukrinform). Reviewing President Zelenskiy’s one day visit to Doha Monday, Zhovkva said: “During the talks, the leaders discussed the possibility of using Qatar’s logistics network to supply Ukrainian food to other countries in the region.” Doha’s Hamad Port and Hamad International Airport are amongst the busiest in the Gulf. President Zelenskiy also encouraged expanding flight connections beyond the current lone flight — Qatar Airways between Doha and Kyiv Boryspil.

Food exports and investment in food processing, irrigation and port logistics will be the topics for discussion today

with Qatar’s Emir, Tamim bin Hamad Al Thani, and Prime Minister, Khalid bin Khalifa Al Thani, Agriculture Minister Roman Leshchenko told Ukrinform. In advance, talks have already taken place with Hassad Food, the agricultural investment arm of the Qatar Investment Authority. From its base in Doha, Hassan has invested $500 million in India for the production of rice and coffee and $500 million in Australia for the production of wheat and sheep.