Friday, 26 May 2017

Weather conditions denting Black Sea yield prospects

It’s been a busy few days on the weather reporting front in the Black Sea region this week.

First off, Bloomberg picked up on the deluge in Russia’s Stavropol region and cold weather in central areas that could have damaged plants.

They say that some areas in the south, which accounts for about a third of Russia’s total wheat harvest, received as much as three times the normal amount of rain in the two weeks to Tuesday.

This has been confirmed by my contacts there who are saying they can’t even get into fields to inspect crops let alone send the sprayer in so we might see some implications on yield and quality.

last month ProZerno forecast Russia’s wheat crop at 67.1mmt, while IKAR pegged the harvest at 64 to 69mmt, and SovEcon have just raised their forecast by 0.5mmt to 63mmt.

ProZerno and IKAR say they are assessing the impact of the weather before potentially revising output forecasts.

Last month, after our March tour, we pegged the Russian wheat crop at 64.7mmt.  

We start the next tour on Monday, kicking off from Stavropol heading north through Russia’s grain belt, at the end of which we will revise our forecast.

Elsewhere in the news, UkrAgroConsult is reporting that cold in Russia’s central black earth region has partially damaged seedlings of sugar beet, corn, buckwheat, sunflower, soya and rape, which if that is true then it would have been cold enough to damage flowering wheat and barley ears.

We will be travelling through that region later in the week and will soon be able to tell if there any cold related issues.

Over in Ukraine and AccuWeather are forecasting hot and dry this summer with “severe impacts” on agriculture.

AccuWeather meteorologist, Tyler Roys, said: “We do expect drought conditions across much of Ukraine, which may damage crops.”

To be honest, it’s unusual for Ukraine not to experience a hot and dry summer, last year was an exception, what is important to know is the condition of the recently planted and emerged spring crops and how they look in terms of coping with hot dry conditions.

The second half of next week will see us travelling across Ukraine assessing just that, so by the end of next week will have a picture of how conditions are affecting this year’s crops and yield prospects.

You can sign up to receive all of this timely and independent information, plus we tour the Black Sea Region on another three occasions this year to provide boots on the ground perspective, all for only £350.

If you would like to subscribe to access the result from this tour and the rest of the tours planned through the 2017 season then email me at blackseacroptour@gmail and I will forward details.

This blog will be running a reduced service next week as we are out and about in Russia and Ukraine assessing the crop condition and yield forecasts.

Black Sea Crop Tours is the only independent crop assessment service operating in the Black Sea region and has been assessing crops since 2014

Thursday, 25 May 2017

Thursday's Black Sea agri-business news

After a warming of trade relations between Russia and Turkey, things appear to have taken on a distinct chill again as Ankara imposed restrictions on imports of Russian wheat in reaction to Russia's earlier ban on imports of Turkish tomatoes.

Moscow has said that restrictions on tomato imports will remain to protect Russian producers.

Russia’s Deputy Minister said at an All-Russia meeting on dairy cattle breeding this week, that the main task is to increase the productivity of the dairy herd reiterating the Ministry’s policy on import substitution and self-sufficiency.

Ukrainian Agriculture Minister Taras Kutovyi has resigned after 13 months in the post to pursue a career in the private, and presumably more lucrative, sector. His predecessor managed 16 months.

Unusually cool weather in Russia and Ukraine risks delaying wheat and barley harvest, report Bloomberg although Ukraine corn planting is now 95% complete with 4.2mha planted.

The Mykolayiv State Agrarian University in Ukraine held a Field Day this week where they introduced 169 new varieties of wheat and barley.

The State Register of plant varieties currently has 351 wheat and 152 barley varieties available to farmers but with no credible performance testing, it’s a case of more must be better, right?

Ukraine’s production of canned vegetables increased by a whopping 61% in April 2017 compared to last year, do they know something we don’t?

Wednesday, 24 May 2017

Cool weather may delay start of Black Sea harvest, only one way to find out for sure

Unusually cooler weather in Russia and Ukraine risks delaying wheat and barley harvest, report Bloomberg today.

Twitter has been hot on the subject this morning asking if it’s likely, if so by how much and what are the implications?

My Black Sea farming contacts have consistently been telling me all season that it’s on the cooler side this year which we have taken to mean better conditions for wheat growth and improved yield prospects as it prefers cooler conditions.

It’s no coincidence the wheat yield record has bounced between the UK and NZ over the last four decades (the record currently resides with a NZ farmer at 16.79mt/ha) and that Irish wheat yields are on average the highest in the world, driven by rainfall, mild winters and long cool summers that help fill grain.

Cooler conditions and plenty of moisture will keep the Black Sea crop growing for longer particularly in southern regions where plants normally die off in the heat rather than ripen, which will help yield prospects there.

We start our Black Sea Crop Tour in southern Russia this coming Monday and will travel north through the Russian grain belt before crossing the border and finishing in southern Ukraine, by the end of which we should have some idea on how delayed the cereal harvest might or might not be.

Sign up to receive results which we post on a Twitter account during the tour and is only open to subscribers, and the follow-up written report emailed out soon after we finish field inspections.

Or you could go and check it out for yourself but as we only charge £350 for the (season long) service your likely to spend that on breakfast and duty-free before you’ve even taken off.

(Email for subscription details)

Ukraine's Minister of Agriculture resigns after 13 months

In an announcement posted online yesterday Ukraine’s Minister of Agrarian Policy and Food, Taras Kutovyi, said he had submitted his written resignation to Parliament.

Kutovyi has been against implementing a market in the sale of land, currently barred under a long running moratorium, so many will be looking to his replacement hoping to see some movement in that direction.

He has been in the post 13 months and his predecessor 16 months, while I’m not entirely sure what that tells you about the current situation in Ukraine’s Ministry of Agriculture, it is saying something.

Kutovyi says he is leaving the post to focus on attracting investment in Ukraine, probably something he would be best placed to do as a Minister.

His resignation is yet to be authorised by the parliament and a successor announced.

Latest USDA weather update for western FSU

Rain continued, maintaining good to excellent prospects for winter wheat and emerging summer crops.

In Moldova as well as southern and eastern Ukraine, moderate to heavy showers (10-35 mm) sustained excellent soil moisture supplies for heading to flowering winter wheat and emerging sunflowers.

However, drier conditions (less than 4 mm) returned to north-central Ukraine, promoting fieldwork but renewing concerns over spring drought; 90-day precipitation has totaled 50 to 70 percent of normal (locally less) in this key corn producing region.

In southwestern Russia, soaking rainfall (25-80 mm) maintained abundant moisture supplies for heading to flowering winter wheat as well as emerging corn and sunflowers.

Farther north, somewhat lighter showers (10-30 mm) in west-central Russia were beneficial for vegetative winter wheat and emerging spring grains.

Latest USDA weather update for eastern FSU

Mostly dry weather in the north contrasted with lingering showers in southern and eastern crop areas.

In northern Kazakhstan and neighboring portions of central Russia, spring wheat planting was able to proceed without significant delay.

However, somewhat heavier showers (5-20 mm) slowed fieldwork at times in the Siberia District.

Farther south, locally heavy showers (10-40 mm) in Uzbekistan and southern Kazakhstan slowed late cotton planting but kept irrigation demands at a minimum.

Latest USDA weather update for Europe

Another round of widespread rain maintained or improved prospects for reproductive to filling winter crops across much of the continent.

A slow-moving frontal boundary was the focus for 10 to 65 mm of rain from northern Spain into France and the United Kingdom.

The rain was too late to offer much benefit to filling to maturing winter grains in northern Spain (impacted by spring drought), but the rain was timely for flowering to filling wheat in France and southeastern England.

Showers were highly variable (1-50 mm) and somewhat lighter in Germany, but nevertheless still beneficial for reproductive winter crops.

While moisture conditions have improved considerably in these locales over the past three weeks, concerns over the impacts of a protracted late-April and earlyMay freeze lingered.

Over the eastern third of Europe, drier, warmer weather (2-5°C above normal) facilitated late summer crop planting and allowed winter crops to accelerate through the flowering and filling stages of development; however, locally heavy showers (10-50 mm) were reported from western Poland into the Balkans, but rain was not widespread.

In Italy, 2 to 30 mm of rain (locally more) in the Po River Valley maintained favourable moisture supplies for summer crop emergence and development.

Friday, 19 May 2017

Latest spring planting figures for Ukraine

Ukraine’s grain and leguminous crops stand at 6.8 million hectares or 94% of the planned 7.2 million hectares.

This includes 172,000 hectares of spring wheat or 97% of the forecast and 1.56mha of spring barley or 95% of the forecast.

Other crops include 5.1mha of sunflowers or 95% of the forecast, 4.2mha of corn 94% of the forecast, with the earliest crops up to leaf five, and 1.7mha of soya or 88% of the forecast.

Sugar beets plantings are up at 309kha or 106% of the forecast.

Russia’s Belgorod region open for business

Earlier this week the Governor of Belgorod held a meeting with a delegation from embassies of the UK, US, Austria, Hungary, Denmark, Germany, Canada, the Netherlands, Norway, Poland and the Republic of South Africa.

The delegation spent two days in the Belgorod getting acquainted with the investment climate and researching the possibility of partnerships in agro-industrial projects.

According to the Russian Ministry of Agriculture, the foreign representatives were particularly interested in horticultural and agricultural biotechnology and vegetable greenhouse production, while the Belgorod representatives noted that there are opportunities in dairy farming, aquaculture and processing of agricultural products.

The Governor of Belgorod said, “We are open to dialogue and cooperation and look forward to the same constructive attitude of your business” and “In the coming years we plan to plant thirty-two thousand hectares of gardens [orchards] and provide one million tons of apples, build at least five hundred hectares of modern greenhouses, to take at least 15-20% of the Russian market of greenhouse vegetables. So, welcome in Belgorod! This is good for everyone!"

Heady stuff.  If you’re interested in investing in Belgorod or elsewhere in Russia give me a call, I might be able to help you get started.

Russia' agricultural bank provided $1.1bn preferential loans

Russia’s Ministry of Agriculture reports that as of the beginning of May, the agricultural bank, Rosselkhozbank, had issued 63 billion roubles ($1.1bn) in loans to agricultural enterprises under the preferential lending mechanism which provides funding at the low rate of 5%.

According to the Ministry of Agriculture, these soft loans are aimed at financing seasonal work which contributed to the quality of the spring sowing campaign.

I might have lost this in translation but 63 billion roubles seems like a lot considering the loan mechanism was only agreed in January and last month the Ministry was complaining the scheme wasn’t working fast enough.

If it is accurate then it makes the Rural Payments Agency look like rank amateurs.

The state-owned JSC Rosselkhozbank was founded in 2000 and is one of the largest and most stable banks in the country in terms of assets and capital.

Latest spring planting figures for Russia

As of May 17, Russia’s spring sowing stood at 27.9 million hectares or 52.9% of the forecast.

Spring grain crops have been sown on an area of 16.6mha, or 53.5% of the target area including 4.9mha of spring wheat, 5.4mha of spring barley and 2.4mha of corn.

Other combinable crops plantings include 4.4mha of sunflower or 62.0% of the forecast and 1.0mha of soybean or 44.4% of the forecast.

Sugar beet planting is nearly complete at 1.1mha or 100.1% of the forecast, potatoes are 140kha or 41.7% of the forecast and 91.6kha of vegetables which represents 45.0% of the forecast.

Ministry of Agriculture of Russia: spring sowing held on an area of 27.9 million hectares (52.9% of the forecast)

Thursday, 18 May 2017

USDA forecast lower Russian wheat crop

USDA have published their latest forecast for Russian wheat at 67.0mmt, down 5.5mmt from last year’s record output although it would still be the second-highest wheat harvest on record.

Back in March, after we travelled 1,200km across Russia, we rated the post winter crop to be in very good condition with no significant winter losses and pegged the yield at 64.7mmt with an export potential of 28mmt.

The USDA 2017/18 harvested area estimate is 27.5 million hectares, up 0.5 million hectares from last year and yield is forecast at 2.44mt/ha, 9% down on last year’s record but 5% above the five-year average.

Winter wheat accounts for around half of the country’s total wheat area and the latest spring wheat plantings are running at 4.3 million hectares or 30% of the anticipated final hectares.

In ten days we will tour the Russian grain belt to make our latest crop assessments and update our yield forecast, our findings and dedicated Twitter account are available to crop tour subscribers so be sure to sign up if you are looking for an independent, muddy boot yield assessments.

There’s only so much crop analysis you can do sitting in an office staring at a computer.

Email blackseacroptour@gmail and I’ll reply with information on our tours and how to subscribe to access the results.

April weather summary for western FSU

During April, wet weather maintained or boosted already favourable yield prospects for winter wheat from southern and eastern Ukraine into western Russia.

In particular, 50 to 100 mm of rain (100-285 percent of normal) was reported over primary winter wheat areas from southern Ukraine into southwestern Russia.

In contrast, short-term drought intensified in northern Ukraine, where April rain tallied less than 50 percent of normal.

This marked the third consecutive month of below normal precipitation in north-central Ukraine, further reducing soil moisture for corn planting and establishment.

April weather summary for eastern FSU

Mild conditions lingered into April in the north’s spring wheat areas, while beneficial rain and mountain snow fell in southern portions of the region.

Temperatures during April averaged 1 to 2°C above normal over spring wheat areas of northern Kazakhstan and neighboring portions of Russia, allowing snow to melt by month’s end and early fieldwork to commence.

Farther south, moderate to heavy rain and mountain snow (25-180 mm liquid equivalent) boosted irrigation supplies for cotton planting and establishment in southern Kazakhstan and eastern Uzbekistan.

In addition, the wetter-than-normal weather (100-400 percent of normal) sustained favorable supplemental moisture for irrigated winter wheat as it progressed through the reproductive phases of development

April weather summary for Europe

Near- to above-normal April rainfall maintained good to excellent prospects for vegetative winter grains and oilseeds over eastern growing areas.

During April, precipitation totalled 100 to 300 percent of normal from Poland into the Danube River Valley, though somewhat drier conditions (less than 75 percent of normal) were noted in the central Balkans.

In contrast, unfavourably dry conditions in Spain, France, and England reduced soil moisture for reproductive wheat and rapeseed, with precipitation during the month totalling a meagre 5 to 30 percent of normal in many growing areas.

Dryness concerns were compounded by a protracted late-season cold snap from April into early May, as a multi-day hard freeze (-9 to -2°C) was noted in many major production areas.

Crops most at risk from freeze injury included: heading to flowering wheat in northern Spain; heading winter wheat in northern France; and flowering winter rapeseed in northeastern France.

Rain in early May eased soil moisture deficits for winter crops in France, but unfavourable dryness lingered in Spain and England.

Wednesday, 17 May 2017

Ukraine reports a new record for grain exports

As of May 17, Ukraine recorded a new record, exporting 39.14mmt of grain, 120,00mt more than the entire previous marketing year.

This included 16.28mmt of wheat, 5.14mmt of barley and 17.5mmt of corn, and in addition to grain, Ukraine exported 306,000mt of flour.

USDA forecast a lower Ukraine wheat crop for this harvest

The latest USDA World Agricultural Production report on Ukraine, released last week, makes some interesting points.

The report forecasts a yield of 3.79mt/ha (56bu/acre), which is 9% below last year’s record but 5% above the five-year average, and goes on to say that abundant soil moisture will support an above-average wheat yield for 2017/18, pegging their latest estimate at 25.0mmt, down 1.8 million from last year.

Back in March, after our first tour of the season, we pegged Ukraine’s wheat crop at 25.2mmt with an export potential of 13mmt.

The USDA report goes on to say that although fall dryness delayed winter-wheat plantings and reduced the time available for crop establishment, the melting of unusually deep snow cover replenished subsoil moisture reserves and benefited winter crops as they resumed spring growth which broadly fits with our findings during our November and March tours.

From 29 May, we will be touring the region again to make our own completely independent assessment of Ukraine’s wheat yield prospects and will make our findings available to our crop tour subscribers.

You could go and check it out yourself but as we only charge £350 for ten full tour reports commissioned throughout the season making each report cost £35, you’d probably spend that on breakfast at the airport on the way out.

Email blackseacroptour@gmail and I’ll reply with information on our tours and how to subscribe to access the results.

Black Sea countries look to steady price volatility

The second meeting of Agriculture Ministers of the Organization of Black Sea Economic Cooperation (BSEC) took place in Istanbul earlier this week.

The meeting was devoted to the theme of sustainable development, food systems, the future of aquaculture, and included discussions on food security for future generations, the development of regional trade, and reducing the negative impact on the environment.

During the meeting, the ministers touched upon the issue of price volatility of agricultural products and agreed that price stability is a very important goal for the BSEC region.

Considering that Russia and Ukraine collectively produce around 12% of the worlds wheat crop and Russia ranks fourth in the world in terms of wheat production after the EU, China and India, and ahead of the US, then any efforts to try and smooth out price volatility could have far reaching consequences.

(BSEC member countries are Azerbaijan, Albania, Armenia, Bulgaria, Greece, Georgia, Moldova, Russia, Romania, Serbia, Turkey and Ukraine with observing countries including Austria, Belarus, Egypt, Germany, Israel, Italy, Poland, Slovakia, the United States, Tunisia, France, Croatia, the Czech Republic and the European Commission.)

China to invest $1.2bn in Belarus

Chinese businessmen have plans to invest more than $1.2 billion in the Belarusian food processing industry, according to the Belarusian Agriculture Minister.

One point two billion, surely that can’t be right, that’s like 2% of the GDP and would buy a lot of Belarussian dairies and sausage factories.

However, it was reported on the Belarus state-owned national news agency, БелТА, so it must be true, who then go on to say that one of China’s largest companies have signed a document declaring their intention to invest around $1 billion in the Belarus economy.

The Belarussian Agriculture Minister is reported as saying China is interested in products made in Belarus as they want to get them from a country they trust as part of their import substitution effort.

Not entirely sure how importing food from another country constitutes import substitution but one planned project is for China to invest $200 million in the construction of facilities to produce milk in Vitebsk Oblast then ship the processed milk to China.

All sounds a bit smoke and mirrors to me.

Tuesday, 16 May 2017

Latest USDA weather update for western FSU

Rain returned, maintaining good to excellent prospects for winter wheat while improving soil moisture for summer crop planting and establishment in previously-dry portions of Ukraine.

In southern Ukraine, light showers (2-10 mm) sustained soil moisture supplies for jointing to heading winter wheat.

Meanwhile, beneficial rain (10-20 mm) in north-central Ukraine eased soil moisture deficits following a protracted dry spell (locally less than 50 percent of normal over the past 90 days), though more rain will be needed to fully ease the impacts of this spring’s acute dryness.

Elsewhere in Ukraine, 10 to 40 mm of rain maintained good conditions for recently-planted soybeans (west) and sunflowers (east).

In southwestern Russia, 10 to 40 mm of rain sustained excellent prospects for winter wheat as it approached or progressed through the reproductive phases of development.

Freezes during the period (-3 to -1°C) over the northern half of the region were not a concern for winter wheat, which was in the freeze-tolerant tillering and jointing stages of development in these more northerly growing areas.

Latest USDA weather update for eastern FSU

Despite occasional showers, the planting of spring wheat (north) and cotton (south) was able to proceed without significant delay.

Spring wheat is typically sown in early to mid-May in central Russia and northern Kazakhstan (a bit sooner in the southeastern Volga District), and this week’s light to moderate showers (2-10 mm) did not significantly impede planting efforts in Kazakhstan and Siberia District.

Somewhat heavier showers (10-20 mm) in the Russia’s Urals District likely slowed fieldwork somewhat, though delays were not protracted.

Farther south, irrigated winter wheat progressed into the early filling stage of development in eastern Uzbekistan in good to excellent condition.

In addition, scattered showers (2-20 mm) in Uzbekistan and southern Kazakhstan did not significantly delay cotton planting efforts.

Latest USDA weather update for Europe

Widespread rain maintained or improved prospects for reproductive winter crops across much of the continent, though the moisture was generally too late for wheat and barley in Spain.

An active weather pattern featured light to moderate showers (2-20 mm) in northern Europe, while locally more than 30 mm fell across the southern third of the continent.

The moisture was timely for reproductive winter wheat and rapeseed in central and northern growing areas, particularly in areas beset with spring dryness from central and northern France into Germany.

While drier conditions (less than 3 mm) lingered in southeastern England (where 90-day rainfall has averaged 50 to 60 percent of normal), well-timed showers were overspreading the United Kingdom on May 15.

Likewise, soil moisture was in good supply for recently-sown corn, soybeans, and sunflowers from Spain and southern France into Italy and the Balkans.

Nevertheless, the wet weather was too late to offer much benefit for filling to maturing winter wheat and barley in central and northern Spain, where dryness and spring heat have lowered yield prospects.

Another big Russian wheat crop on the way

Russia’s Ministry of Agriculture reports accumulated fertiliser stocks up 10% more than last year which points to another big Russian crop this harvest.

While it’s too early to call the spring sown crops as just under 50% are still to be planted, my sources across Russia are quietly telling me their wheat is looking good.

Recent rains should now take it over the finish line, barring a catastrophic heat wave or a plague of locusts (both of which could happen).

We’ll be touring Russia in two weeks and will get a fuller picture then but I have noticed that less rain this season compared to lasts suggests we won’t see the same level of lodged crops and diseases.

Which also suggests improved quality for new crop wheat which could encourage discounts for old crop still languishing in sheds which won't be getting any better the longer it sits there.

Russia and Belarus held talks to resolve trade dispute

Russia and Belarus held talks yesterday to try and resolve the current dispute over Belorussian exports of food products to Russia. 

Previously, Russia’s agriculture watchdog, Rosselkhoznadzor's had inspected several Belorussian enterprises and then promptly banned the import of many Belorussian products over food safety concerns.

The outcome of yesterday’s meeting appeared to be inconclusive and seemed to focus on Belarus adopting an electronic system of veterinary certification within the framework of the Eurasian Economic Union.

Which probably what the spat is really about rather than anything to do with food safety.

Monday, 15 May 2017

Black Sea Crop Tour back on the road

The Black Sea Crop Tour bus hits the road again in precisely two weeks time.

We will travel 2,000km through Russia and Ukraine to assess the post planting condition of corn, sunflower and soya and the ongoing condition of wheat just ahead of harvest and to make our latest yield forecasts.

As usual we will post pictures, video and commentary on the members only Twitter account so subscribers can see what we are seeing in a comprehensive and totally independent tour of the region.

We will follow this up with full written reports after finishing the road tour.

After this tour, we have three more lined up through the rest of the season to assess the major commodity crops condition at key stages through the growing cycle.

All this insight for only £350 for the year, drop me a line at blackseacroptour@gmail for subscription details.

Monday Black Sea agribusiness news

Chinese President Xi Jinping said that China is willing to strengthen strategic coordination and deepen mutually beneficial cooperation with Kazakhstan.

Kazakh President Nursultan Nazarbayev said Kazakhstan is willing to deepen cooperation with China in such areas as trade, agriculture, mining industry, railway, and technology.

The two leaders met and made the comments at the Belt and Road Forum for International Cooperation in Beijing yesterday.

The agriculture ministries of Belarus and Russia will hold a working meeting in Moscow today to try and resolve the current dispute over Belorussian agri-exports to Russia.

You may recall that Russia’s agriculture watchdog, Rosselkhoznadzor's inspected several Belorussian enterprises which then resulted in Russia banning imports of many Belorussian products over food safety concerns.

Turkey will resume wheat imports from Russia today just a few days after the trade dispute between the two countries was settled.

Russia’s Deputy Prime Minister said opening of the Turkish market will allow Russia to increase its grain exports in the current agricultural year which have lagged behind expectations and with new crop harvest weeks away it’s unlikely exports for the current marketing year will reflect the record crop from last year.

Ukraine grain exports reached 37.2mmt for the current marketing year, 9% more than same period last year.

Thursday, 11 May 2017

Russia continues to protect its tomatoes

During talks in Sochi last week, Russian President Putin and Turkish President Erdogan agreed to lift almost all the restrictions on bilateral trade between the two countries.

During the meeting, Putin said the Russian embargo on Turkish tomatoes would remain, explaining that it is in the interest of Russian farmers.

"Our agricultural producers had taken out large loans and credits. This is a rather long production cycle, which in our climatic conditions is related to the construction of greenhouses," the Russian leader explained while Russia’s Deputy PM chipped in saying the tomato embargo may continue for another three to five years.

So, it looks like I hit the nail on the head last week when I suggested the reason why Russia is standing firm on Turkish tomato imports is because finance for construction of Russian glasshouses is already committed.

Not entirely sure how this sits with WTO rules but as no one seems to pay any attention to the WTO it probably doesn’t matter anyway.

Currently the Russian harvest of greenhouse vegetables stands at 200kmt which is 80% more than last year so I think Russia’s policy on vegetable production, in particular tomatoes, is fairly clear for the next few years at least.

Before the introduction of the restrictions, Turkey was the largest supplier of tomatoes to Russia, presumably those Turkish tomatoes will now be seeking a new home elsewhere, possibly in the EU so watch out for the knock-on impact on tomato producers elsewhere.

Latest spring planting figures for Ukraine

Ukraine’s early sowing of spring grains and legumes is in the final stages with 2.3 million hectares or 98% of the forecast planted.

This includes 168,000 hectares of spring wheat or 95% of the forecast and 1.56mha of spring barley or 95% of the forecast.

Other crops include 4.2mha of sunflowers or 78% of the forecast, 3.5mha of corn also 78% of the forecast and 1.1mha of soya or 56% of the forecast.

Sugar beets plantings are up at 306kha or 104% of the forecast and our friend buckwheat is progressing with 34kha in the ground representing 24% of the forecast.

Latest spring planting figures for Russia

As of May 10, Russia’s spring sowing stood at 16.5 million hectares, or 25.3% of the forecast.

Spring grain crops have been sown on an area of 7.7mha, or 31.4% of the target area including 1.9mha of spring wheat, 3.8mha of spring barley and 1.9mha of corn.

Other combinable crops plantings include 2.8mha of sunflower or 39.3% of the forecast and 623kha of soybean or 27.5% of the forecast.

Sugar beet planting are nearly complete at 1.1mha or 92.7% of the forecast, potatoes are 80kha or 23.8% of the forecast and 66kha of vegetables which represents 32.4% of the forecast.

Wednesday, 10 May 2017

Latest USDA weather update for western FSU

Sunny skies prevailed over much of the region, promoting fieldwork and winter crop development.

High pressure extending from Scandinavia into western Russia maintained dry, warm weather (2-5°C above normal) over much of the region, promoting the development of vegetative to heading winter wheat following recent rainfall.

The sunny, mild conditions also favored corn and sunflower sowing, though showers (10-40 mm) in western Ukraine slowed soybean planting.

Despite the overall good to excellent conditions for winter crops, a lack of rain in north-central Ukraine exacerbated short-term drought (25-50 percent of normal rainfall over the past 60 days), leaving soil moisture in short supply for corn planting and emergence.

Latest USDA weather update for eastern FSU

Sunny skies favored spring grain planting in the north and winter wheat development in the south.

Early spring grain planting was able to proceed without delay due to dry, warm weather (1-4°C above normal) in central Russia and neighboring portions of northern Kazakhstan.

Farther south, irrigated winter wheat progressed through the reproductive stages of development in eastern Uzbekistan in good to excellent condition, with above-normal year-to-date precipitation providing abundant supplemental moisture for crop development.

In addition, the dry weather during the past week promoted cotton planting in Uzbekistan and southern Kazakhstan.

Latest USDA weather update for Europe

Wet weather benefited vegetative to reproductive winter crops, while the impacts - if any - of recent hard freezes remained unknown.

The recent late-April and early-May hard freezes were mostly a threat to flowering rapeseed in northeastern France and reproductive winter wheat in northwestern Spain.

However, whether the recent freezes caused any burnback or damage remained unknown, as it can take weeks for crops to exhibit the full extent of freeze injury.

During the past week, freeze concerns were reduced as temperatures moderated somewhat, with freezes (-3 to -1°C) mostly confined to northeastern Germany and northwestern Poland.

More importantly, much-needed rain (5-40 mm, locally more) returned to southeastern England, France, and northwestern Spain, improving soil moisture for reproductive wheat and rapeseed after a dry start to the spring.

Farther east, widespread showers (2-30 mm, locally more) sustained good to excellent prospects for vegetative to reproductive winter grains and oilseeds from Germany and Poland into the Balkans.

The wet weather also sustained favorable soil moisture for recently-planted corn, soybeans, and sunflowers, but slowed late sowing efforts.

Friday, 5 May 2017

Friday AM Black Sea agribusiness news

The first batch of Turkish onions has been sent to Russia after Putin and Erdogan agreed to cancel mutual trade restrictions.

The lifting of restrictions includes Russian grain to Turkey however Russia insisted on keeping restrictions on Turkish tomato imports and postponing the reintroduction of a visa-free regime for Turkish nationals.

So while it looks like the trade dispute between the two countries is over for now don’t be too surprised if it flares up again the future.

As of May 4, the gross yield of greenhouse vegetables across Russia amounted to 200,700mt which is almost twice the same date last year and includes 32,500mt tomatoes (up from 18,000mt in 2016).

Russia is planning to build 200 hectares of greenhouses this year which goes someway to explaining why Russia is standing firm on Turkish tomato imports as I assume the finance for construction is already committed.

Louis Dreyfus have opened a grain terminal in Russia’s Rostov region, completed in partnership with the European Bank for Reconstruction and Development.

The terminal is located on the river Don with a total storage capacity of 50,000mt and will be used for the transhipment of grains on sea-river vessels with an initial annual export capacity of 800,000mt, aiming to exceed 1 million tonnes over time.

At the opening of the terminal Margarita Louis-Dreyfus said, “We are convinced that Russia will remain a dominant player in the global agricultural markets”.

The Committee on International Trade of the European Parliament has voted not to increase annual quotas for imports of Ukrainian wheat, tomatoes and urea saying the EU should continue offering trade preferences to Ukraine but some agricultural products do not require additional support by the EU.

Following on from the fertiliser shortage in Ukraine story I posted last month (here), I keep hearing rumblings that it is a real problem.

My take on it is that there was sufficient supplies and stocks of nitrogen fertiliser to feed the winter crops last month but now spring plantings are in full swing we might see complaints increase if there is a problem as suppliers fail to deliver on orders.

Meanwhile across the pond all eyes are on Kansas after heavy snow and freezing conditions occurred in the key winter wheat production areas on crops that looked to be at heading stage.

The Kansas wheat tour running this week had many tweets suggesting there will be a yield penalty but it’s too early to tell how much at this stage.

Later this month we kick off the second Black Sea crop tour of the season looking at spring crops and wheat which also had snow dumped on it a couple of weeks back.

Wednesday, 3 May 2017

Latest USDA weather update for western FSU

Beneficial rain in southern and central growing areas contrasted with developing dryness in northern Ukraine.

A slow-moving storm system produced 10 to 50 mm of rain from southeastern Ukraine into southern and central Russia, maintaining abundant moisture supplies for jointing winter wheat.

A second area of moderate to heavy rain (10-40 mm) boosted moisture supplies for vegetative spring grains in Belarus and northwestern Russia.

Despite the active weather pattern, rain bypassed areas from Moldova into central Ukraine and Russia’s Central District.

The dryness was welcomed in Moldova and Russia, where precipitation over the past 60 days has totaled 100 to 200 percent of normal.

However, the lack of rain in north-central Ukraine exacerbated developing short term drought (25-50 percent of normal rainfall over the past 60 days), leaving soil moisture in short supply for corn and sunflower planting and emergence.

Latest USDA weather update for eastern FSU

Spring grain planting gained momentum in the north, while showers maintained excellent moisture supplies for crops in southern growing areas.

Early spring grain planting was able to proceed without significant delay despite scattered showers (5-30 mm) in central Russia and northern Kazakhstan.

Farther south, winter wheat approached or progressed through the reproductive stages of development in Uzbekistan in good to excellent condition, with above-normal year-to-date precipitation providing abundant supplemental moisture for crop development.

However, showers slowed cotton planting in eastern portions of Uzbekistan (10-20 mm) and southern Kazakhstan (10-500 mm).

Latest USDA weather update for Europe

Hard freezes posed a risk to reproductive winter crops in western growing areas, while soaking rainfall boosted soil moisture but hampered fieldwork from southern Spain into Poland.

For much of the week, a stationary frontal boundary was the focus for moderate to heavy rain (10-50 mm, locally more) from southern Spain into Poland.

The wet weather improved soil moisture for recently-planted corn, soybeans, and sunflowers, but impeded late sowing efforts.

Furthermore, heavy to excessive rain (40-170 mm) in southern Spain (Andalucía) was detrimental for filling to maturing wheat, while totals approaching 100 mm in northeastern Italy and northern Slovakia caused localized flooding.

North of the front, unseasonably cold, dry weather prevailed across much of central and northern Europe.

Crops most at risk for freeze damage included: flowering winter wheat and barley in northern Spain (5 nights of subfreezing low temperatures since April 18, with readings as low as -9°C); heading winter wheat in northern France (8 nights of freezes since April 17, with values as low as -5°C); and flowering rapeseed in northeastern France (9 nights of freezes since April 17, with a minimum of - 7°C).

The full extent of freeze impacts - if any - will not be known for days or weeks, until producers are able to inspect fields.

However, crop-stage estimates (based on growing degree day data) suggested crops were progressing through key reproductive stages of development in the aforementioned areas during the cold snap.

Tuesday, 2 May 2017

Tuesday AM Black Sea agribusiness news

Belarus wants to send its inspectors to Russian agricultural companies, the country’s Minister of Agriculture told Belarus TV.

The statement came as a response to a series of inspections, organized by Russia’s agriculture watchdog after Moscow imposed restrictions on imports of Belorussian products.

It's unlikely Russia will accommodate such a request in what appears to be a tit-for-tat response as relations between the two countries remain poor.

The Russian vertically integrated meat and feed producer, Cherkizovo Group, has completed the acquisition of one of Russia’s leading grain producers, NAPKO.

Cherkizovo Group, listed on the London and Moscow stock exchanges, is one of Russia’s top three companies producing chicken, pork and processed meat and is the country’s largest feed manufacturer.

The transaction worth $85.6 million, increases Cherkizovo Group’s total operating land bank to 287,000 hectares.

Russia may lose its status as the top wheat export due to the trade crisis with Turkey.  

Turkey was the second largest buyer of Russian wheat, so if Russia fails to reach an agreement with Turkey, the volume intended for that country will be redirected to other markets, which will take time, according to Russia’s Deputy Agriculture Minister.

Russia’s early wheat harvest begins in June which will only add to the already high carryover stocks.

A four-year project funded by USAID is seeking to boost credit lending to agriculture in Ukraine and improve the quality of the financial services and products offered to farmers.

Launched in April, the project is designed to strengthen the credit union sector in Ukraine in order to improve the quality of the financial services offered to farmers and other agribusinesses in rural areas.

Good idea but my experience of credit facilities in Ukraine is collateral and interest rates are both prohibitively high particularly for the smaller scale farmers.

A Ukrainian-German company has invested $1.1 million installing solar panels inside the Chernobyl exclusion zone which should start producing electricity by the end of June with a capacity of 1.5 megawatts.

The Ukrainian government wants to install enough panels inside the exclusion zone to produce 2.5 gigawatts - equivalent to about half the capacity of the plant before the fourth reactor exploded in 1986.

The solar project is partly viable because of the infrastructure left over from the Soviet era, including networks of power lines.

Low land rents are also plugged as an incentive.