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IMC reports declining oil crop yields in 2017 season

Ukrainian farmer IMC (IMC PW) reported on Oct. 11 it has completed its harvesting campaign of sunflower seeds and soybeans for this year, with both yields declining on a yoy basis. The average yield of soybeans was 2.3 t/ha, or about 32% less yoy. The average yield of sunflower seeds was 2.9 t/ha, or about 8% less yoy. IMC highlighted that its crop yields are 53% better for sunflower and 28% better for soybeans than Ukraine’s average in this year's harvest.


The company harvested in 2017 about 25 kt of soybeans, or 16% more yoy (mostly due to a 72% yoy rise in harvested area), and 70 kt of sunflower seeds (11% less yoy).


Also, IMC announced the conclusion of its winter wheat sowing campaign. It sowed 12,700 ha of winter wheat, or 7.3% less yoy.


Andriy Perederey: The company’s yields of oil crops decreased yoy due to worse weather conditions, reflecting a nationwide trend this season. The result is clearly discouraging, especially in soybean, whose planted area was significantly increased this season.


Meanwhile, corn remains IMC’s flagship crop (57% of total planted area for this season) and it will determine most of the company’s results for 2017 and first half of 2018. So far, interim corn statistics in Ukraine are not encouraging, pointing to a decline in nationwide yields by about 10% yoy. While this season won’t be the best for IMC, we remain bullish on its stock, which still has good potential for mid-term growth.
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