Russia will set a record for wheat exports during the current marketing year while Ukraine rebuilds its grain shipments, aided by the recent international agreement to end a blockade of its Black Sea ports, said USDA analysts. Bayer, the world’s largest seed and ag chemical company, said on Monday that it would help rebuild Ukraine’s agricultural system but also would continue to sell crop inputs in Russia, the instigator of war with Ukraine.
The Russian invasion of Ukraine on Feb. 24 disrupted global food supply chains, drove up commodity prices around the world and created the possibility of food shortages in import-dependent countries in north Africa and the Middle East. Russia and Ukraine were two of the world’s largest exporters of wheat, corn and sunflower oil.
USDA analysts estimate combined wheat and corn exports from Ukraine of 23.5 million tonnes during 2022/23, a 3.5 million-tonne increase from their forecast of 19 million tonnes a month ago. Exports would include 11 million tonnes of wheat and 12.5 million tonnes of corn, they said in estimates released at the end of last week. Before the invasion, Ukraine exported more than 40 million tonnes of wheat and corn annually.
Russia, meanwhile, was forecast to harvest its largest-ever wheat crop, 88 million tonnes, this year and export 42 million tonnes of it, also a record. Wheat production also was forecast at a record high of 138 million tonnes in China as global output rose to its highest level ever, 779 million tonnes, said the USDA.
About a dozen grain ships, primarily loaded with corn, left Ukrainian ports in the three weeks that followed the July 22 agreement among Russia, Ukraine, Turkey and the United Nations to open a corridor through the Black Sea, said a monthly USDA circular.
“This potential relief valve for Ukrainian grain supplies comes at a timely moment, as exports historically pick up substantially over the next several months,” said the USDA. Shipments typically surge in the months following harvest. Wheat exports are largest from August through November and corn export are at their peak from November to May.
In a statement, Bayer said sales of crop inputs to Russian farmers would “ensure they can contribute to fulfulling the global demand” for food.
“We share the view of the United Nations that global access to Ukraine’s food products and Russian food and fertilizers is essential to alleviate pressure on the global food system,” is said. “At the same time, we hope the Russian government continues to safeguard the free flow of agricultural products and never again use food as a means of pressuring the world.”
Based in Germany, Bayer said it planned to make “significant investments” in Ukraine over the next decade, “mainly to rebuild Ukraine’s agricultural system.”
In its monthly WASDE report, the USDA said this year’s U.S. wheat crop would sell for an average $9.25 a bushel, a record high although $1.25 lower than it estimated in July. “This is based on prices received to date, which are lower than previously expected,” said the USDA.