News From Ukraine: Farmers will harvest more corn than they can use
We check in with Ukrainian farmers who are putting their extra bushels of corn to good use.
We want to take the time to check in on farmers in Ukraine as harvest in the country continues. Today, it looks like they will actually harvest more corn than they can use domestically this year, but those extra bushels will be put to use.
Latifundist Media has partnered with us to provide boots-on-the-ground coverage:
Harvest Holding Commercial Director, Tetiana Alaverdova says, “Let’s say we need to dry corn by 10 percent. We harvest the grain with an average moisture content of 25 percent. This means that we need $50 per ton to dry the corn. We will cut production if it becomes unprofitable.”
Low prices for agricultural commodities, challenges, and exports, and high natural gas make growers consider alternative options for working with corn in Ukraine. Corn is one of the most common crops in the world, with the U.S. being the world’s largest producer. Ukraine is the world’s fifth largest producer, but this year, Ukrainian farmers are not happy to be among the key growers. Ukraine’s domestic corn consumption is rather low - 230 million bushels per year. According to forecasts, the corn harvest this year should be about 1.2 billion bushels. Therefore, the prospects of 980 million bushels of corn in light of this year’s crisis remain uncertain.
Moreover, agricultural producers have already started harvesting corn. So far, 1 percent of the crop has been harvested. This is why we analyzed what steps the situation causes farmers to take this season. Some producers are preparing to leave corn in the field for wintering - this entails the risk of crop failure and pests. A small portion of producers are also considering burning corn.
Yehor Skliarov with Seim-Agro says, “It is most profitable to burn corn, for its cost is lower than that of natural gas. So put it into the heat generator and press “on.”
There is a tendency among agricultural producers to buy distilleries and use the new crop as raw material. This is what large enterprises did. Deputy Minister of Agrarian Policy and Food of Ukraine, Taras Vysotskyi marks the importance of such steps.
“A distillery is, first of all, bio-ethanol, biofuel. The sector has recognized that it is much more profitable to produce alternative energy sources, bio-ethanol, bio-gas, bio-methane, than just to sell raw materials and then buy natural gas for drying corn at inflated prices,” said Vysotskyi.
Another option is the construction of green field corn processing plants. There are countless options for end products.
A bio-ethanol plant is one of the projects on the agenda of Ukraine today.
“By 2030, we have plans to process 80 million tons of corn per year and to reach this goal we have to build more than20 corn processing plants in Ukraine,” author of Big Agro-Processing, Oleksandr Batatin
Typically, these are long-term investments, but large Ukrainian businesses are prepared to invest in such projects.
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