Agrokultura has sown more sunflowers than wheat, as it
sought to make up in spring plantings for the poor autumn sowing conditions in
the former Soviet Union which hampered seedings of winter crops.
The farm operator in Russia and Ukraine highlighted that
sunflowers had become "the most significant group crop in terms of hectarage",
with sowings rising by 20% to 29.3m hectares.
The increase contrasts with a 40% tumble to 24.4m hectares
in winter wheat sowings, reflecting in part the sale of land in Kaliningrad,
where 1,900 hectares of winter wheat was sown for the 2013 harvest.
However, it is also down the wet autumn which forced many former
Soviet Union farmers to abandon until spring many acres which had been earmarked
for winter grains.
Indeed, Russia-based peer Black Earth Farming also highlighted
the "challenging winter crop planting conditions" by revealing last month that it
has hiked sowings of sunflowers too, by 28% to 37,233 hectares.
By contrast, seedings of winter wheat, usually the group's
most widely-sown crop, tumbled by 59% to 30,207 hectares.
Black Earth Farming - which sells sunflower seed, along with
potatoes, to Frito-Lay, the PepsiCo-owned snacks manufacturer – also raised
sowings of corn by 52% to 55,822 hectares although it eased back on seedings of
some other spring crops.
In rapeseed, spring sowings dropped by 44% to 17,717 hectares,
and in barley by 24% to 16,712 hectares, contrasting with ideas that spring
plantings of the grain overall will rise in the former Soviet Union, thanks to
its relatively low need for imported inputs.
Weakness in the rouble and the hryvnia has made bought-in
seeds and agrichemicals more expensive for foreign farmers also negotiating, in
Ukraine especially, tricky credit conditions.
In Russia too, where "banks are worried by farmers' high
indebtedness and the growth of delinquent loans", financing for farmer was, at
75bn roubles as of mid-May, equivalent to about $2bn, running some 11% behind
that a year ago, US Department of Agriculture foreign officials reported.
Indeed, the USDA officials believe that, largely thanks to
the expense of importing high-class seed from the likes of the US, Russian
production of sunflower seed will fall by 1.0m tonnes to 9.5m tonnes this year, on a similar planted area.
They see Ukraine production falling by 1.6m tonnes to 10.5m
tonnes, factoring in "the overall economic situation in the country prior to
and at the time of the spring planting this year.
"Producers are not expected to maximize sunflower yields," the
USDA's Kiev bureau said.
"They are rather expected to reduce costs by either purchasing
cheaper inputs or making fewer chemical applications and in general modifying
production technology to cut down production expenses."
'Among the most
A fall in sunflower seed production would contrast with a growing
crush capacity in Ukraine, where Kernel Holding last week flagged the impact of
a strong 2013 harvest in boosting its processing margins, by undermining raw
material prices and allowing it run plants closer to full capacity.
For producers, Agrokultura chief exective Stephen Pickup
said that "over recent years, [sunflowers have] been among the most profitable
crops, with relatively low costs and good pricing driven by the general oilseed
Agrokultura pegged its overall planted area at 119,200
hectares, down 15,200 hectares year on year, of which some 8,000 was down to the
sale of the Kaliningrad farms.
The group also lost some ground to a wet finish to the Ukraine
spring sowing campaign, but is also, like Black Earth Farming, switching to a
strategy of focusing on its most profitable land.
The group said that all its spring crops had been "sown into
an excellent seedbed and have had good weather conditions to emerge strongly", echoing
comments from Kernel and Trigon Agri last week over the health of their crops.
Agrokultura shares, which are listed in Stockholm, eased
0.3% to SEK2.90 in morning deals.