GAFTA hopes conditions for work on Ukrainian grain market will improve in 2011

Kyiv, December 17 (Interfax-Ukraine) – The Grain and Feed Trade Association (GAFTA) hopes that Ukraine will set transparent and predictable rules for operating on the grain market.

"We hope that next year it will be easier to work on the Ukrainian grain market… and the grain market in Ukraine would be transparent and predictable," the director of the GAFTA Office in Ukraine, Anna Golodova, said at a press conference at Interfax-Ukraine on Thursday.

She said that recent events in Ukraine linked to grain export restrictions have caused serious alarm in the international grain trading community.

The President of the Ukrainian Grain Association (UGA) Volodymyr Klymenko said that the international grain market expects that this year the country will export 15 million tonnes of grain.

"Everyone is waiting for us to give 15 million tonnes to the international market. If we don't do this, we'll [cause] the world's [grain stocks to be too low]," he said.

Klymenko expressed hope that the problem of grain exports from Ukraine would be settled in a civilized manner and the country would supply the required volume of grain to the foreign markets. He said that since the start of the current marketing year, the country has exported around 800,000 tonnes of corn, 2.1 million tonnes of barley and 2.1 million tonnes of wheat.

He said that currently grain is exported under licenses issued until December 31, 2010. The expert doubts that traders will be able to export the volume of grain foreseen in the licenses by the end of 2010.

"I'm not sure that all of the companies will be able to export the volume of grain for which they obtained licenses by the end of the year," he said.

Golodova also said that despite existing problems, GAFTA would hold a gala dinner in Kyiv, Ukraine, for the first time in 130 years. It is expected that it would be held on May 26, 2011 with the participation of over 1,000 representatives of international grain companies.

She said that in January 2011 Ukrainian citizen Oleksiy Havrylov could head GAFTA. He is GAFTA's deputy president now.

As reported, in the autumn of 2010, grain exports were blocked in the Ukrainian ports by the State Customs Service of Ukraine as it carried out checks on grain quality. Later the Ukrainian government from October 19 to December 31, 2010 introduced grain export quotas for 2.7 million tonnes of grain, including 500,000 tonnes of wheat, 200,000 tonnes of barley, two million tonnes of corn, 1,000 tonnes of rye and1,000 tonnes of buckwheat.

On November 12, 2010 the ad hoc commission distributed 2.182 million tonnes of the quota between the companies. Nibulon Ltd., Kernel-Trade Ltd. and Serna, a company with foreign investment, have obtained 52.6% of the grain export quota. Many large companies did not obtain the quotas.

Last week, Ukrainian Agriculture Minister Mykola Prysiazhniuk said that the Cabinet of Ministers of Ukraine would prolong the quotas on grain exports until March 31, 2011, and increase them by 1.5 million tonnes.