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14 July 2024

News

16.12.2022

Forecast: in 2023 the sown area under grain in Ukraine will be reduced by 45%, and the gross harvest - by 60%

2023 will be full of significant changes in the agricultural sector of Ukraine. According to preliminary estimates, in 2023 in Ukraine the sown area under grain crops will be reduced by 45% and the grain harvest will be 60% less compared to the pre-war 2021. The reasons for this reduction are: a decrease in all sown areas, a change in the structure of crops and a decrease in the yield of grain crops.

As of December 2022, out of 28.4 million hectares of all sown areas that were available in 2021 throughout the territory of our country, 24.6 million hectares (86% of the total territory) are located on the controlled territory of Ukraine, of which 3.8 million hectares cannot be sown due to closeness to the front line, mines, etc. 

The sowing campaign of winter crops has already passed and a significant reduction in sown areas can be observed. 3.8 million hectares of winter crops were sown, which is 26% lower compared to the autumn indicator of 2021 in controlled areas and 43% lower than crops throughout Ukraine. It should be noted that the northeastern and central regions have more critically reduced the areas of winter wheat.

The reason for this trend is the limited ability to export, expensive logistics and, as a result, a significant difference in prices across regions. Regions that are territorially close to seaports and borders with the EU have a higher price for agricultural products compared to regions in the north and east of our country. So, in Transcarpathia, the price of 1 ton of corn with VAT is 6800 UAH, and in the Sumy region - 4900 UAH. However, even in the western regions the price is unprofitable. Therefore, proximity to the border with the EU and working ports determines the ability of the respective areas to continue grain production.

Considering a significant part of the logistics in the price of grain crops this year, there will be a decrease in crops under grain crops with a simultaneous increase in crops under oilseeds. The price of oilseeds is 2 times higher than the prices of grain crops on the world market. According to preliminary estimates, the sown area under grain crops in 2023 will amount to 8.7 million hectares, which is 22% less than in 2022 and 45% less than in 2021. At the same time, the area under oilseeds is projected at 9.7 million hectares, which is 32% more than in 2022 and 9% more than in 2021. This is the first time that the sown area under oilseeds will be larger than under grain crops.

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Considering a 50-60% decline in fertilizer application, significant unharvested corn fields, lack of funding and the need for significant savings, the expected yield will decrease depending on the region and crop by 10-30% compared to the average yield of previous years.

As a result, the projected grain harvest in 2023 may reach 34 million tons, which is 37% less than in 2022 and 60% less than in 2021. As for oilseeds, a gross harvest of 19.3 million tons is expected, which is 13% more than in 2022 and 15% less than in 2021.

Taking into account the given gross production volumes and domestic needs of Ukraine, the export potential of grains and oilseeds in MY 2023/24 will be about 35 million tons, or 3 million tons per month. For comparison: in 2021/22 MY, the export potential was at the level of 85 million tons of grains and oilseeds, or 7 million tons per month.



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