In the first quarter of the new marketing year, Ukraine produced nearly 494 thsd tonnes of wheat flour, which became somewhat lower compared with the same period last year (507 thsd tonnes), as well as the first three months of the season-2015/16 (515 thsd tonnes). The official statistics reported about such decline in production, which is likely linked to increasing of the "shadow" market of flour in Ukraine. Because the actual shipment volumes of flour on the foreign market continue increasing from year to year, despite the reporting reduction of production volumes.
During the first three months of 2017/18 MY, the exports of Ukrainian flour increased to 117.14 thsd tonnes, including 44.04 thsd tonnes shipped in September, which became the highest rate per month in the first quarter of the marketing year. In the same quarter period last season, Ukraine supplied 94.28 thsd tonnes of flour on foreign markets, including 34.398 thsd tonnes in September. And in July-September of 2015/16 MY, the exports totaled 87.21 thsd tonnes only. In the current season, the market demonstrates a significant growth of flour shipments, despite the fact that the country already exhausted all reserves and opportunities last year. Such rates give hope that Ukraine can even move beyond the most ambitious forecasts.
Also, the prices in the reporting period significantly increased compared with the last year prices. It is a good result, because the record global harvest of wheat meant somewhat further decline in food prices. For comparison, the diagram used the prices of large-scale companies-exporters for top-grade flour in bags on FCA terms.
It should be noted that expansion of the export geography of Ukrainian flour, which developed last year, will continue keeping in the current one. Thus, the African market traditionally covers one quarter of the shipments of Ukrainian flour, and taking into account the supplies to the Middle East, the exports towards the reporting destination totals more than 40%. It is worth noting that the shipment volumes to North Korea did not significantly decreased.
In particular, in September Ukraine shipped almost 19.5 thsd tonnes of flour to North Korea, or almost all volumes delivered on the East Asian market. Unfortunately, in the same month Ukraine exported much less product to South-East Asia, mainly to Singapore.
For just three months, Ukraine supplied 49.4 thsd tonnes of flour to North Korea (42.3% of the general exports of flour from Ukraine), up 10 thsd tonnes compared with the same period last year, and the share of the reporting importer increased by 1% in the general export structure.
At the same time, Ukrainian flour millers continued actively shipping the product to Angola, which confidently took the second position among the major consumers of Ukrainian flour. Also, the supplies on the markets of Somalia and Libya remained at the same level.
In addition, small-scale export batches to Venezuela become permanent at the expense of supplies by the Agrarian Fund. The company proved that the exports to far South America can be profitable when makes professional approach to the business. Portugal and Uganda became new countries-importers of the Ukrainian product.
So, in the first quarter of the season-2017/18 Ukraine supplied flour to more than 40 countries, including the USA, which imported 7 tonnes, and Slovakia, which purchased 10 tonnes only.
In particular, in September 2017 the number of countries-buyers of the Ukrainian product lower to 26, which markets received at least one container from Ukraine.
Since the beginning of the season, the list of major companies-exporters of flour slightly changed. Chmielnicki Mlyn Group took one of the major positions in the TOP-10 of the Ukrainian exporters, and plans to reach the leadership positions.
It is worth noting that 10 enterprises from 118 ones, which realized foreign supplies in the reporting period, shipped 101.905 thsd tonnes of the product, or 87% of the general 3-month exports. Last season, the TOP-10 of exporters shipped 76.438 thsd tonnes for three months, or 81% of the general exports. At that time, in that period 88 enterprises realized the sales of flour on foreign markets.
To date, TH Novaagro became the leader in flour shipped volumes. In fact, it is Novopokrovka Factory of Bakery Products, which always kept the first positions of the rating. Vinnytsia bread factory #2 took the second position. And Chmielnicki Mlyn Group took the third positions, but we already mentioned the company. Kombinat Khliboproduktiv Talne made some rebranding, and changed its name to Ukrainian flour milling company. It is expected that in the nearest future the company will return to the usual first position in flour shipments. SFGCU PJSC somewhat slowed down, and drastically reduced the volume of flour exports. At the same time, the Agrarian Fund returned to the list of companies-exporters, and plans to continue shipping large-scale volumes of the product on a monthly basis.
In conclusion, it is important to note the significantly increased export volumes in the first quarter, and wish Ukrainian flour millers to continue the successful trend!
Director of Production operations department at Agrarian Fund PJSC