Asian countries retain leadership in import of Ukrainian wheat

| ProAgro

At the moment, spring field works are still under completion in Ukraine. According to the Ministry, as of April 18, 2017, the sowing of spring and leguminous crops was carried out on an area of 2.6 million ha, which corresponds to 36% of the 7.2 million ha, which were planned previously. It includes 155 thousand ha of spring wheat (86% of the forecasted figure). We also should keep in mind that about 5.9 million ha were sowed with winter wheat under the harvest of 2017.

At the same time, the wheat of the previous harvest continues to be actively supplied to foreign markets, although the volumes of such exports show a gradual decline, approaching the end of the season due to the gradual depletion of stocks. The main external consumer of Ukrainian wheat in the current season is India, where a fifth of Ukrainian wheat exports have been shipped. India, which is, traditionally, the largest external consumer of sunflower oil produced in Ukraine in MY 2016/17, significantly increased the purchase of wheat from Ukraine. The reason for this was an inadequate volume of domestic grain supply and, consequently, a significant increase in prices in the country"s domestic agricultural markets. In order to increase the volume of external supplies and regulate the prices of imported wheat in September 2016, Indian government reduced import duty on such products from 25% to 10%. Consequently, in December of the last year, this fee was completely abolished. At the same time, it should be noted that on March 28, 2017, a decision was made to introduce the duty rate of 10%. This suggests that the situation with insufficient domestic grain reserves in the country is settled and in the near future it is likely that the volume of foreign trade supplies of wheat to India will decrease.

Geographic structure of wheat exports from Ukraine

2015/16 (July-March)

2016/17 (July-March)

Importer

Share in export structure

Importer

Share in export structure

1

Thailand

15,8%

1

India

20,0%

2

Egypt

12,0%

2

Egypt

11,1%

3

Indonesia

8,4%

3

Thailand

10,2%

4

South Korea

8,1%

4

Indonesia

9,6%

5

Spain

7,7%

5

Bangladesh

8,9%

6

Bangladesh

7,2%

6

South Korea

7,3%

7

Philippines

4,1%

7

Marocco

5,2%

8

Tunisia

4,0%

8

Philippines

4,7%

9

Marocco

3,8%

9

Israel

3,3%

10

Italy

3,5%

10

Tunisia

3,0%

11

Israel

3,3%

11

Spain

2,7%

12

Jibuti

3,1%

12

italy

2,1%

13

Syria

2,6%

13

Lebanon

1,9%

14

Mexico

2,0%

14

Libya

1,4%

15

Ethiopia

1,6%

15

Alger

1,1%

Other

12,8%

Other

7,7%

In general, the geographical structure of foreign trade in wheat of Ukrainian origin demonstrates a clear predominance of the Asian region. It accounts for more than 60% of the total grain exports from Ukraine. As noted earlier, the main change in the geographical structure of foreign trade in Ukrainian wheat was the sharp increase of India as a key importer. In the rest, the composition of the main importing countries of Ukrainian wheat in comparison with the same date of the last season hasn"t changed much.

Biggest wheat exporters

2015/16 (July-March)

2016/17 (July-March)

Company

Share in export structure

Company

Share in export structure

1

Nibulon

7,1%

1

Nibulon

7,6%

2

State Food and Grain Corporation of Ukraine

6,7%

2

Kernel

7,4%

3

Kernel

5,3%

3

Cargill

5,3%

4

Cargill

5,3%

4

State Food and Grain Corporation of Ukraine

5,0%

5

Vtormetexport

3,0%

5

Bunge Ukraine

3,5%

6

Nobble Resources Ukraine

2,9%

6

Louis Dreyfus Ukraine

3,2%

7

Louis Dreyfus Ukraine

2,9%

7

ADM

3,0%

8

Bunge Ukraine

2,8%

8

Agroprosperies

2,0%

9

ADM

1,8%

9

Ambar Export

1,5%

10

Kraevid-Export

1,8%

10

Nobble Resources Ukraine

1,4%

Other

60,3%

Other

60,0%

If we take Ukrainian companies into account, the market is rather poorly concentrated, however, according to ProAgro, five or more percents (each) in the total volume of exports for the July-March MY 2016/17 accounted for: Nibulon, Kernel, Cargill and State Food and Grain Corporation of Ukraine. At the same time, the market share of exporting companies, which are not included in TOP-10 is 60%.