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Ukraine to reap bumper 2014 grains harvest

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Ukraine's grains harvest will reach a bumper 60m tonnes this year, lifted by a strong start to autumn-sown crops – provided fears over thin snow cover are not realised.

UkrAgroConsult, in its first forecast for grains production in a country once known as the breadbasket of the Soviet Union, pegged it at 60.1m tonnes, up some 3.5m tonnes from last year.

The forecast comes despite a dismal start to autumn sowings which were, as in Russia, delayed well beyond the ideal planting window by persistent rains.

However, warmer-than-usual conditions in October and November allowed farmers to catch up on most of their autumn sowings, now seen falling less than 400,000 hectares for wheat, and, combined with moistened soils, ensured crops a strong start.

"Owing to sufficient soil moisture supply everywhere and warmer-than-usual weather in October and November, condition of winter crops improved significantly prior to their entry into winter," Kiev-based UkrAgroConsult said.

'One of the best'

Indeed, 99.9% of winter grains had emerged by early December, compared with 95.5% a year before.

UkrAgroConsult forecasts for Ukraine's 2014 grains harvest and (change on year)

Winter wheat: 21.64m tonnes, (+3.0%)

Spring wheat: 440,000 tonnes, (+10.0%)

Winter barley: 3.50m tonnes, (+32%)

Corn: 27.45m tonnes, (+5.6%)

Total grains (includes others): 60.092m tonnes, (+6.3%)

"Overall, this year's condition of winter grains at the end of autumn growing was one of the best in recent years," the influential consultancy said.

"This year's normal density and mostly optimum development of plants, enough productive moisture in the soil suggest that these crops' grain yields will be somewhat higher than last year."

Lower profitability

However, the consultancy acknowledged some downside to its estimate for the overall grains production in the forecast of a 27.45m-tonne corn harvest, saying this may prove optimistic given dents to farm profitability.

There was a "probability" that the consultancy would downgrade its forecast of 5.08m hectares of corn sowings, "due to decreased corn growing margin in 2013.

"Comparatively low market grain prices, and additional grain production costs for drying too-wet corn, slashed revenues of many farms," UkrAgroConsult said.

"Decreased application of inputs in grains cultivation practices may reduce [crop] productivity against last year."

Frost risk

Furthermore, the forecast assumes no pick-up before the end of the winter in frost damage to crops – a concern of many investors given unusually warm winter temperatures, which have melted the protective snow blanket.

In some areas of the Black Sea "there is not enough snow cover to protect crops from any sharp drop of temperatures", Agritel noted.

UkrAgroConsult noted that "5-15 centimetres of snow covered winter crops in most regions, except the Steppe zone, from December 1-10. This snow melted almost entirely by the end of December".

'Snow cover limited'

Weather service MDA said that "snow cover remains limited across Belarus, western and southern Ukraine and southern North Caucusus".

However, MDA added that a snow blanket "should begin to rebuild there in the six-10-day period as cooler conditions return.

"Temperatures should remain above winterkill levels across the region."


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