Supply Chain

Ukraine 2023 Early Grain Harvest Could Drop By At Least 50%

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Ukraine's winter grain sowing area for the 2023 harvest will unlikely to exceed 2 million hectares and the harvest could fall by at least 50%, the head of a large Ukrainian agriculture company was quoted as saying on Thursday.

The pace of sowing winter wheat in Ukraine for the 2023 harvest is three times lower than last year, according to data provided by the agriculture ministry this week.

Farms have sown 1.1 million hectares of winter wheat as of 3 October, or 27% of the expected area, compared with 3.1 million hectares sown at the same date in 2021, the data showed.

"It is unlikely that we will gain 2 million hectares (of winter grain sowing area)," Alex Lissitsa, CEO of IMC integrated agricultural business, was quoted by Interfax Ukraine as saying.

"The harvest of early grains (mostly wheat and barley) will be 50-70% less (in 2023 versus 2022). In fact, we will cover our own needs, but not everything will be so rosy with exports," he added.

Ukraine consumes around 7 million tonnes of wheat and up to 4 million tonnes of barley per season.

Challenges

Lissitsa said that a lack of funds for the sowing remains a huge problem for farmers in a situation where when local grain prices fell while cost of inputs rose sharply.

"I think that next year we will have a huge decline in productivity and yields, and at the end of the year we will come out quite beaten: not dead, but badly beaten", he said.

A senior Ukrainian agriculture official said on Wednesday rains across most the regions had delayed the harvest and winter grain sowing.

The ministry has still not given a forecast of the 2023 winter wheat area, although Agriculture Minister Mykola Solsky told Reuters in August that the area could fall to 3.8 million hectares from 4.6 million a year earlier because of Russia's invasion.

Analysts, however, say the area could be significantly smaller.

Winter Wheat 

Ukraine sowed more than 6 million hectares of winter wheat for the 2022 harvest, but a large area has been occupied by Russian forces since the invasion in February.

Ukraine harvested 19 million tonnes of wheat this year, compared with around 32.2 million tonnes in 2021. The sharp decline was the result of hostilities in many regions and the occupation of large areas by Russian forces.

First deputy agriculture minister Taras Vysotskyi said last month that Ukraine's 2023 wheat harvest may decrease to 16-18 million tonnes from 19 million tonnes in 2022 because of an expected fall in the winter wheat sowing area.

News by Reuters, edited by ESM – your source for the latest supply chain news. Click subscribe to sign up to ESM: European Supermarket Magazine.

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