Ukrainian producers of poultry, pigs and animal feed ask the government to limit export of corn.
Currently, the grain memorandum for the current MY contains only agreed position on export of wheat and rye.
The Union of Poultry Farmers of Ukraine, Pig Breeders of Ukraine, Tvarynprom, the Union of Feed Producers of Ukraine propose to limit export of corn from Ukraine in the current 2020/2021 marketing year (MY) to 22 million tons, while the U.S. Department of Agriculture estimates its export is 24 million tons with the harvest being 29.5 million tons. According to the producer associations, the domestic market needs about 7.5 million tons of corn for production of animal feed.
The population of farmed animals and production of animal products in Ukraine goes down. In 2021, the poultry numbers are down by 9.3%, cattle by 6.2% and pigs up by 2%. In 2020, Ukraine lowered meat production by 1.5%, eggs by 2.9% and milk by 4.2%.
The Ukrainian Grain Association, in its turn, opposes limiting corn exports. According to the acting executive director of the Ukrainian Grain Association (UGA), Serhiy Ivaschenko, the rise in corn prices is due to global trends and will continue, because of an attempt to administratively restrict its exports from Ukraine. "The state should not administratively influence the price, but only through market mechanisms. The associations of poultry farmers and livestock breeders have come up with an initiative to limit exports, because they cannot buy corn at current prices. At present, corn is expensive, so sooner or later they will have to get used to these prices and proceed from the market situation."
According to the expert, in the 2020/2021 marketing year, the corn harvest amounted to about 30 million tons, with the annual needs of the domestic market of Ukraine of about 5 million tons. Serhiy Ivaschenko noted that as of mid-January 2021, exports from Ukraine amounted to about 10 million tons, which is almost 3.5 million tons less than on the same date in 2020, including the new crop of 2020 of 8 million tons.
Thus, there are still more than 21 million tons of corn of the new crop in Ukraine and according to UGA, it is impractical to talk about some kind of deficit, since the peak period of corn export has passed and the rate of export will decrease. In their press release the association stated that the purpose of the restrictions is to use administrative measures to reduce domestic corn prices by oversupply in the domestic market.
"We are always open to proposals of specialized associations, which we discuss at general meetings, form an opinion and give feedback. Thus, the Ministry of Economy received a number of requests from agricultural associations to include the issue of corn in the memorandum [on mutual understanding on the grain market]," states the press release of the Ministry of Economy, citing Deputy Minister Taras Vysotsky, regarding the results of a meeting with agricultural associations held on January 18.
Deputy Minister expects that a joint decision will be taken in a week. In addition, within a week, the signatories of the memorandum will share their position on export of corn and approximate balances for this crop. Currently, the grain memorandum for the current MY, signed in August last year, contains only agreed position on export of wheat and rye at the level of 17.5 million tons and 16,000 tons, respectively.
Source: https://en.interfax.com.ua/
Update as of 26.01:
The Ministry of Economic Development, Trade and Agriculture of Ukraine and participants of the grain market on January 25, 2021 agreed to determine the maximum volume of corn exports at the level of 24 million tons in 2020/2021 MY. Corresponding changes will be made to the annex to the Memorandum of Understanding between the participants of the grain market, as was informed by the Ministry.
