Ukraine grain exports fall 1.4x yoy in 5M13

Ukrainian grain exports rose 9.4% yoy to 21.9 mmt in the 11 months of the 2012/13 marketing year, the Agrarian Ministry reported on June 3. Wheat exports increased 38% yoy to 6.7 mmt, while corn exports grew 1% yoy to 12.7 mmt, the ministry said.

Alexander Paraschiy: The marketing year’s boost in exports was due to abnormally high shipments in its first half (14.4 mmt in Jul-Dec 2012, +51% yoy). In the first five months of this calendar year, however, grain exports fell 1.39x yoy (3.0 mmt yoy) to 7.5 mmt, by our estimates. This implies 5M13 brought about USD 0.7 bln less in export revenue compared to the first five months of calendar year 2012.

Despite widely held expectations of a much better grain harvest in Ukraine this year, we are unlikely to see any yoy increase in grain exports in 2H13 due to a high comparison base. In 2H12, farmers were hurrying to export due to weak harvest results and a risk that the Agrarian Ministry would limit exports. As soon as this year’s harvest is expected to be better, there will be no reason to hurry in 2H13. Therefore, we see a high chance that grain exports will fall this calendar year, which could be another problem for Ukraine’s current account deficit.