Ukraine has enough milling wheat but prompts traders to switch to feed grains

Ukraine’s Agriculture Ministry sees no threat to domestic supplies of milling wheat despite the high pace of exports but prompted traders to switch to feed grains for the rest of the 2021/22 July-June season so as not to fuel inflation.

“So far we see no danger for the domestic wheat market,” deputy minister Taras Vysotsky told a meeting with traders and producers.

He said the volume of already exported milling wheat amounted to about 80 percent of the total export volume expected in the current season.

The ministry’s data showed that 10.8 million tonnes of milling wheat were exported so far this season out of a total 13.4 million tonnes expected for the season.

The ministry said 2.6 million tonnes of milling wheat was available for export in the remaining months of this season.

The deputy minister advised traders to switch to the export of feed grains so as not to fuel an increase in domestic prices for wheat.

Ukraine has exported 5.3 million tonnes of feed wheat so far in 2021/22, or around 45% of the volume available for feed wheat exports this season.

Last month, two sources said that Ukraine, a major global grain producer, would consider limiting milling wheat exports in the first half of 2022.

Government officials were concerned strong exports would raise domestic prices for high quality bread-making wheat, making the staple more expensive at a time when Ukraine’s inflation is close to 2018 highs.

Producers and traders, however, say the ministry figures do not take into account contracts already signed by traders.

“Unfortunately, government does not see forecasts for export sales by traders and does not keep statistics on farmsales. The introduction of such a practice would make the market transparent,” Elena Neroba, business development manager at brokers Maxigrain, said.

The next meeting of the ministry and traders on the grain market situation is scheduled for early February.

Reuters 

Tags: Ukraine, export, grain, wheat, restrictions