Once the bread basket of the former Soviet Union, Ukraine plans to become Europe’s leading grain exporter in the coming years when sales could reach 15 million tons, a top government official said on Sept. 23.
Deputy Prime Minister Leonid Kozachenko said Ukraine would take advantage of better technologies and its swathes of rich soil to boost output and exports despite tough competition on the world markets and European efforts to curb grain imports.
“I’m sure we can say that Ukrainian grain exports will rise to up to 15 million tons in the next two or three years,” Kozachenko told Reuters in an interview.
“In any case, Ukraine will be a net exporter and our grain harvest will rise every year,” he said. “Ukraine is located in a unique natural and climate zone. It has rich black soil and not one European state or ex‑Soviet republic can compete with us.”
The International Grains Council, in an Aug. 29 forecast, said Ukraine would export 5.5 million tons of wheat in 2002/03, compared with 14.5 million tons by the European Union countries combined. Kazakhstan was forecast to export 4.5 million tons of wheat in 2002/03.
Kozachenko said Ukraine had large tracts of land that could be cultivated more effectively to boost output. Ukraine has about 30 million hectares of agricultural land.
“We have large areas of agriculture land and need to plant only a small part of that to cover domestic consumption. If we plant all our land and use modern technologies, we will increase the harvest and boost exports,” Kozachenko said.
Ukraine, which plans to harvest about 40 million tons of grain this year – a similar amount to last year – needs up to 27 million tons of grain to cover domestic needs, he said.
Officials say Ukraine hopes to increase grain exports this season to 12 million tons from about nine million last season.
In the 2001‑2002 season Ukraine exported about five million tons of mostly feed wheat to traditional customers in North Africa, South Korea and the Middle East.
Earlier this month Kozachenko said the government’s strategic task was to increase the amount of higher quality milling wheat in export volumes and gain market share in Brazil, Japan, Tunisia and Europe after Australia, Canada and the United States reported damaged crops.
This year the share of milling wheat rose to 60 percent of the wheat crop from about 35 percent a year ago.
Experts said Ukraine’s ports could handle the increased volume of exports after coping with a sharp rise during last season and this year, but they doubted whether Ukraine’s under‑funded farming sector could boost output to those levels.
They said Ukraine’s farmers were still struggling with poor quality seeds, a lack of manure and Soviet‑era machinery more than a decade after winning independence from the Soviet Union.
“If we want to harvest record crops we have to think about giving funding to farmers. But a lack of funds in the budget makes this absolutely impossible,” said analyst Mykola Vernytsky of Proagro, a consulting firm.
“Ukraine’s current upper export level is between 5 and 6 million tons per season due to our dependence on the weather,” Vernytsky said.
Analysts said a bout of bad weather would cut Ukraine’s grain crop sharply. Due to poor weather in 2000, Ukraine harvested just 24.4 million tons.
They also said recent plans by the European Union, a key destination for Ukrainian grain over the past two season, to curb imports would hurt Ukrainian sales. Earlier this month the EU proposed a global quota and tariff regime on wheat imports to protect its markets.
“We should be cautious about expecting the current high harvests and export levels to continue,” one trader said, suggesting that Ukraine had been lucky two years in a row.
