Ukraine's spring crop areas for 2023-24 strongly depend on the continuity of seaborne exports, seed supply, and the availability of crop protection products and fertilizers. But earlier expectations suggest a sowing shift from corn to more profitable oilseeds.
Ukraine's final 2023-24 winter acreages remain unclear, but at least the market has an official forecast for them — the country's spring crop areas for the next season are still unmapped. They will depend on additional factors, including the operation of the grain corridor, the situation in the combat zone, supply availability of seeds, crop protection products, fertilizers, etc, with market participants suggesting that the spring crop planting structure in Ukraine could change significantly next year.
The planting area for corn — Ukraine's main spring grain crop — could drop sharply to 3.5mn hectares (ha) in the 2023-24 season from 4.6mn ha this season, according to the latest forecast by the Ukrainian Grain Association (UGA). "It is too early to make an accurate forecast, but the situation with exports, funds and costs of fertilizers can lead to a decrease in corn acreages in Ukraine," UGA chief executive Serhiy Ivaschenko told Argus.
"We will cut corn acreages, as the cost of seeds, crop protection products, fertilizers, drying and logistics make corn production unprofitable for us. The unpredictable situation with the grain corridor and inability to trade forward contracts also increase risks to corn production," Tetiana Alaverdova, head of sales at Harveast Holding, said.
But some producers are not going to decrease corn acreages in the next season, despite the production risks. "We know how to grow corn, and for us the switch to other crops poses higher risks than corn production. We are going to save money, primarily on fertilizers, and will try to use sunflower seed pellets for corn drying," — a farmer from the Poltava region told Argus.
Oilseed and niche crop acreages
Meanwhile, both market participants and analysts agree that Ukraine's sunflower seed (SFS) acreages are unlikely to decrease in the next marketing season. UGA's first forecast for 2023-24 SFS acreages stands at 4.6mn ha, in line with this season's figure. The association also expects an increase in soybean planted areas for the 2023-24 crop to 1.4mn ha from 1.2mn ha in the 2022-23 marketing year.
The main reason for rising SFS and soybean acreages in the next season is good profitability of both crops, with a value-to-logistics ratio the highest for exports. In addition, oilseeds can easily find demand in the local market, in contrast to grain crops, which have a strong exports surplus.
Niche crops — chickpea, peas, lentil, mustard etc — could also face an increase in planted acreages in Ukraine next year, as farmers can switch to their growing in case of large stocks of main crops.
"Our holding already has an experience in mustard, lentils, peas, and linseed production and trade, so we are going to increase planted areas for these crops," Alaverdova said.
Meanwhile, it is too early to make any predictions for final spring acreages in Ukraine in the 2023-24 marketing year, with producers likely to make their choices based on how many stocks of different crops they will have by the start of the planting campaign next spring.
