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Prices for agri commodities
The price of barley
Ukraine is one of the largest grain exporters in the world. The three main grain crops grown and exported by farmers include wheat, corn and barley. Due to low production costs and a wide market, barley is an attractive crop for export.
What factors influence the price of barley in Ukraine
According to the results of a statistical analysis conducted by the US Department of Agriculture, in 2021-2022 Ukraine took fourth place in terms of barley production. It is surpassed only by the countries of the European Union, Russia and Australia.
A large number of varieties of winter and spring barley are grown in Ukraine, which are used in the domestic market, and some are exported to other countries. According to the European Commission, the share of Ukrainian barley in the world grain market is 13%. Its main customers are:
- Saudi Arabia;
The price of barley is formed under the influence of:
- the level of demand for culture on the world market;
- volume of offers from exporting countries;
- the quality of barley, which is determined by the basic indicators of moisture, grain and garbage admixture;
- production costs for the purchase of seed grain, fertilizers, fuel for the machinery used to sow and process barley.
Barley export prices depend on the following factors:
- areas sown with barley in countries that are among the main exporters of the crop;
- weather conditions affecting barley yield in all countries exporting it;
- demand for Ukrainian barley, which depends on its quality, confirmed by certificates;
- peculiarities of logistics and the type of transport used (sea vessels, railway wagons or trucks);
- exchange rate.
The cost of barley is also affected by the crop growing period. During harvest, grain can be bought at the minimum purchase price. In the following months, the price gradually increases due to the addition of grain storage costs. Barley prices begin to rise rapidly at the beginning of winter. Peak values are observed in February and March, and then a decline begins.
On specialized online services, you can see what the price of barley is today in any region of Ukraine. To do this, you only need to select an interesting region or city. The convenient table presents current prices per ton of grain for the specified characteristics: moisture, weeds, etc. On such services, it is convenient to monitor the dynamics of purchase prices, specify the terms of the agreement, and find contacts of traders or other buyers.
What price is offered for barley in Ukraine
The average price of barley today in Ukraine is UAH 4,614 per ton without VAT. At this price, grain can be sold to elevators. The price of barley delivered to feed mills and other processors is usually higher and amounts to UAH 6,500–7,300 per ton. This is due to the fact that it includes the cost of product delivery. For those who export barley, the price per ton today settled in the market at the level of 145 dollars.
It is quite difficult for producers to export barley on their own, like any other grain. This will require a thorough knowledge of the rules of international trade and contract drafting in order to write down all the terms and conditions and avoid losses. In addition, experience is needed to find foreign partners, negotiate with them and conclude a trade contract for the profitable sale of barley. At the time of the agreement, the grain quality must meet international standards, which is confirmed by certificates.
High logistics costs for grain delivery to the port make trading in small lots inefficient. Therefore, the best solution is to contact a reliable trader. He has enough knowledge, experience and business connections to:
- prepare a large batch of barley for sale and issue all the necessary documents;
- find a buyer who wants to buy barley at a price favorable to the producer, conduct negotiations and sign a properly drawn up contract;
- ensure the supply of barley along the optimal logistics chain.
Forecast price of Ukrainian barley in 2023
The forecast of prices for barley in 2023 in Ukraine was made taking into account the reduction of the area under crops:
- winter barley – up to 968,000 hectares, which is 16.8% less than last year’s value;
- spring barley – up to 918.8 thousand ha, which is 45% less than last year.
Ukrainian agricultural enterprises planned to harvest 8.2 million tons of barley in 2022. Adjustments were made by the war started by Russia against Ukraine. The southern regions are partially under occupation, they are the main producers of barley. Therefore, the crop yield in Ukraine decreased to 5.5 million tons. The average yield this year was 34.7 c/ha. Traders offer farmers purchase prices for barley in the range from UAH 2,500 to UAH 4,900. per ton.
The reduction in the area sown under barley in Ukraine and the under-harvested amount of the harvest due to military operations in the southern regions affected the situation on the world market. Saudi Arabia, China and other large importers will have to raise purchase prices in order to increase the supply of barley by Ukrainian companies. The only option for supplying grain to these countries is by sea. Until now, the ports in Ukraine are blocked by the Russian military fleet, and it is impossible to ensure a stable export of grain.
Before the war, the export potential of barley was 10–10.5 million tons, Ukrainian ports successfully handled it. At present, the pace of export depends on the operation of the “grain corridor”, through which grain is sent from three Black Sea ports: Odesa, Chornomorsk and Pivdennyi (Odesa region).