The harvest season is about to start in Ukraine
There has come the time in Ukraine to begin harvest. The latest forecasts made this week on “The Grain Forum” organized by the APK-Inform analytical company in Odessa (biggest port area in Ukraine) for the grain crop are as follows: the total crop is going to be 57 million tons including 20.3 mln tons of corn, 19.2 mln tons of wheat and 7 mln tons of barley. Accordingly grain export forecast is 30.2 mln tons (2 mln tons lesser than this marketing year) including 19 mln tons of corn, 8.5 mln tons of wheat and 2.3 mln tons of barley.
The forecasts for soybeans are as follows: crop of 3.5 mln tons with 2-2.2 mln tons to be exported.
But there are two problems that may decrease the forecasts. First and the major one is Russia.
After the annexation of Crimea (and with the loss of Crimea Ukraine also lost half of its rice fields) there was a fear that Russia would invade Ukraine in order to provide the corridor between Rostov oblast and Transnistria and to cut Ukraine from the Black sea.
Fearing the possible severe sanctions from the EU and the USA Russia had not ventured to invade Ukraine. Instead Russia invented the new type of the war. It started to send mercenaries to Ukraine and to supply them with a heavy weapon like tanks, anti-aircraft launchers, armored vehicles and guns. These mercenaries fight together with local criminals. The situation is really dramatic because these people use civil population as a “live shield” and place their guns in living areas.
There is no law on territories that are under control of these terrorists. Kidnappings, lootings, murders, the “expropriation” of cars, vehicles, fuel, disruption of railroads and bridges happen daily.
So grain growers there face lack of fuel, trucks and often they are unable to move the crop to elevators. Traders are reluctant to settle contracts with the grain growers from the war areas.
In the worst case scenario the losses due to the war in the South-East Ukraine may reach 8 percent of the grain and 7 percent of the vegetable oils with the corresponding decrease in export.
Second problem is the rains in the South Ukraine. Typically the harvest begins in the South and harvesters gradually move to the North. Now with the long lasting rains in the South Ukraine and good weather in the north areas there may arise the situation in which there will be the deficit of harvesters.