Ukraine reduces barley production

In Ukraine, against the backdrop of a reduction in sown areas and the impact of weather risks, a significant decrease in the gross barley harvest in the new season is expected. This is reported by the analytical department of the agricultural cooperative PUSK, established within the VAR.

“This year, we expect a barley harvest of about 5.1–5.3 million tons, which is 40% lower than the pre-war level. This means a significant decrease in supply already at the start of the season, and the market is gradually starting to take this into account in prices,” analysts note.

Demand for Ukrainian barley is growing, especially from China, which is returning to the market, and the countries of Southern Europe. This creates the prerequisites for stabilization and even growth in export activity.

“China has already contracted about 500 thousand tons of Ukrainian barley for July–August, and European importers — in particular, Spain and Italy — are also intensifying purchases. Traders are trying to close the volume needs in advance, given the limited prospects for domestic production,” the PUSK reported.

Analysts also see the potential for price growth in the second half of the year, especially if weather risks are confirmed and the harvest turns out to be even smaller than forecast.

“At the start of the season, the price model shows a level of $200–205/t on a CPT basis, but by December-January we can expect prices of $230–240/t. The market is already showing a willingness to pay more for a limited supply of quality barley,” analysts forecast.

Tags: Ukraine, barley, crop forecast