Black Sea region developing into major global grain exporter

The Black Sea region’s development as a big player on the global export market is seen continuing, as it has become one of the biggest exporters of wheat in the world.

“The region went from being one of the biggest net importers to one of the biggest exporters of grain,” said Dr. Dmitry Rylko of the Institute for Agricultural Market Studies (IKAR) at the Cereals North America global grain conference in Winnipeg.

Southern Russia, he noted, now makes up 10 per cent of world wheat exports.

Despite that, Rylko said wheat exports from the Black Sea region (Russia, Kazakhstan and Ukraine) are expected to be lower than the USDA’s September estimates, mostly due to lower production.

He said it’s expected that Russia will export roughly 15 million to 15.5 million tonnes of wheat, Kazakhstan 6.5 million to eight million tonnes and Ukraine approximately nine million tonnes. The quality of wheat in all three countries, he noted, is not very good.

However, even with the poor wheat crops, the Black Sea region produced a large corn crop.

Ukraine “produced an incredible volume of corn,” Rylko said, adding that country exported more corn this year than wheat. “Russia also surpassed their record of corn production.”

Looking forward, he warned that climate, logistics, moisture content and other factors could hold back the region from becoming a major player in the corn market.

— Brandon Logan writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

Related story:
Black Sea wheat exports to fall as Russian farmers hold back, Oct. 25, 2013