Structure of the planted areas in small farms, as well as in large-scale agriholdings, changes, due to the unpredictable weather conditions, unstable economic situation, and changes in law. Thus, APK-Inform Agency has asked the experts of the key companies-suppliers of seeds in Ukraine about the farmers’ preferences over the crops and their choices.
As usual, we asked the responders several hot-seat questions:
- The seeds of which spring crops are the most popular among Ukrainian farmers? Why?
- Are there any changes in terms of the choice of the grain seeds and oilseeds varieties (hybrids)? Why?
- What is the price tendency on the seeds market before the spring planting campaign in 2018? Are there any changes versus last season?
- Are there any changes of the farmers’ preferences over the domestic and the foreign seeds selection for 2-3 recent years?
Konstantin Ivanyuk,
Head of the marketing department, Syngenta
- The main spring crops in Ukraine are corn and sunflower. They are the most advantageous in terms of profit making thus they are the most popular among the farmers. The segment of spring grains in Ukraine is rather small versus the winter crops and is presented mostly by spring barley. I can assume that in Ukraine the planted areas can be shifted among the main crops due to the changes in Ukrainian law of VAT refund. The farmers’ choice of the crop depends on three key factors – the price, the specification of the agribusiness and agricultural engineering i.g. the effective agricultural technology in terms of which the crop rotation is highly important.
- The competition on the sunflower seeds hybrids has risen drastically for the last 5 years. For now, the offers from the key companies-suppliers of the foreign selection of sunflower seeds exceed the market demand. Thus, the farmers point out not only the origination of the seeds, but also the characteristics and the volume of possible profit. In particular, the farmers estimate the genetic yield potential of the crop, oil content, maturity group, resistance to disease and abiotic stresses, and the sensitivity to the cultivation technology intensity. Herewith the price is highly important as the farmers pay close attention to the value of the product, which should be correctly positioned towards the price.
- Syngenta is highly concerned over the price of the seeds the company sells. We have the department dealing with examining the potential crop yield, stress resistance, unique characteristics and later correlating the obtained results with the farmers needs in order to satisfy their requests and set the relevant price for the product. For example, Syngenta actively renovates its corn portfolio. Thus, we have the hybrids of new genetics – genotype of “Artesian”, which are new spring hybrids with high cold resistance and yield.
- First of all, we should separate the concepts of selection and production. The selection is the process of hybrid developing which can be realized in any country. And the production is the place where the product is grown. We can say that 85-90% of all the planted areas in Ukraine are used for production of sunflower seeds of foreign selection. In terms of corn we can point out that the share of foreign selection seeds in Ukrainian areas is growing since 2000 and for now it obtain 55-60% of the acreages.
Sergey Reznichenko,
Head of marketing department, DuPont Pioneer, Ukraine
- This season sunflower is a market leader. The prices make it highly profitable because of the high demand rate. The high oleic sunflower is going to become the market tendency for the current year, because it’s yield can exceed the linoleic one and the growing capacities increase. Last year the weather conditions prevented to obtain the high gross collection of corn thus some farmers consider the exposure of growing it. But, the right choice of the corn hybrid is the best way to get the successful crop cultivation. It should also be noted that some farmer choose to grow peas, buckwheat, chickpeas etc. The strategy is profitable up to the time the market is overwhelmed. Thus in terms of these crops production growth for the second season so far the prices for pulses could become highly unexpected.
- There is no fundamental changes of farmers’ choice of main crops hybrids this year. But the requirements of seeds quality increase as there is a tendency of transferring for the professional selection.
- The price trend on the market is a question of matter as there are many factors influencing it: payment policy, buying time (the beginning or the ending of the season), seed treatment etc. Altogether, the prices for the corn or wheat seeds stayed on the same level year-on-year, or increased 3-5% max. Speaking about DuPont Pioneer I should say that the company was keen at fixing the price in hryvnias during the season. That is why the one who decided to invest into seeds in the beginning of the current season have profited on the exchange rate difference and obtained additional discount for the seeds.
- Here I should note that during the last several years there is a tendency of the professional selection seeds transition. According to our experience and the independent market research the share of domestic selection seeds decreases by 1-2% every year. The company Pioneer has switched over in part oe in whole to hybrid seeds (i.g. corn, sunflower, rapeseed).
Vladimir Kuzmich,
Product-manager of corn and sunflower seeds, Limagrain
- This year in Ukraine we can observe the high demand level on sunflower seeds. Such a tendency appeared due to the fact that in 2007 in some oblast of Ukraine the drought forced the farmers to reconsider the crop rotation in favor of more profitable crops. The prices on crop seeds market depend mostly on demand rate which changes every year. I should point out that the demand for the spring barley (especially brewer’s barley) is decreasing each year but I suppose that the farmers should not give up on this crop as in the near future it may become highly marginal. Thus we are planning on increasing the supply rate of barley. On the other hand the royalty issue is a key problem and we are ready to work with the partners ready to pay for the genetic and high quality seeds. We are aiming at farmers to profit, for them to be sure about the future and at the reduction of the counterfeit goods on the domestic market.
- Speaking about corn, I would say that many farmers repeatedly were buying the seeds with high early maturation index. The genetically modified hybrids have high yield but the farmers sometimes do not manage to harvest the crops. Moreover the quality of the product is quite low. Speaking about sunflower seeds last year many farmers observed the broomrape. That is why this season the farmers prefered to buy the hybrids resistant to this weed. And speaking about grains the tendency for high yield prevail the everything else.
- The purchase price of the seeds is an index of the farmers’ prosperity. Thus the advanced farms use the expensive seeds as the technical equipment enable receiving high quality and yield of the crops. But in terms of corn seeds farmers are not ready to pay for the seeds, because the competition is high on the market and farmers are looking for more profitable prices.
- Speaking about sunflower the share of imported genetical seeds in increasing every year as many farmers do not trust the domestic seeds. And even if there is a seeds supply deficit the agrarians are not ready to buy domestic products. On the other hand the share of farmers ready to buy domestic seeds of corn amounts to 30-40%. In our company the high sales volume is observed for sunflower and corn. But also, there is a stable tendency for peas sales. Speaking about spring crops, the sales volume of spring wheat and barley is increasing step-by-step.
Prepared by Julia Shevchenko, APK-Inform Agency
