Daily monitor

The gross harvest of oil-producing crops in Ukraine in 2009 is expected to amount to 9 mln metric tons. This total is estimated to include sunflower at 6.1 mln metric tons, while that figure stood at 6.8 mln metric tons in 2008. It also anticipates rapeseed in the amount of 1.89 mln metric tons and soybeans at 0.95 mln metric tons. The area under oil-producing crops has been constantly increasing in Ukraine throughout 2009, with 4.16 mln ha of sunflower planted, as well as 1.4 mln ha of rapeseed and 0.6 mln ha of soybean.

The Kyiv-based Myronivsky Hliboproduct [MHPC LI] has gathered its harvest of rapeseed and wheat crops. The Company reaped 208.3 thsd metric tons of wheat and 38.4 thsd metric tons of rapeseed. On average, the Company’s wheat yield is 5.9 metric tons/ha. The average yield for rapeseed is 2.7 metric tons/ha, whereas the Ukrainian average is 1.9 metric tons/ha. MHP has already concluded forward export contracts for almost the full amount of rapeseed it produced, as well as for 50% of its wheat harvest. The Company has completed harvesting sunflower by 98%, the average yield for which is currently 3.1 metric tons/ha. Corn is currently being gathered, with 40% of the land under cultivation already harvested. Its yield is, on average 8.5 metric tons/ha.

According to a note from the State Statistics Committee of Ukraine, the merchandise balance declined by a further USD 628 mln into deficit in August. Therefore, the merchandise balance in January-August reached a deficit of USD 3.76 bln, representing a 70.1% YoY decline. The Committee noted that merchandise exports have dropped 49.4% YoY in January-August to USD 23.75 bln, while merchandise imports have contracted 53.8% YoY to USD 27.51 bln. The merchandise balance demonstrated a USD 18.53 bln deficit in 2008, an estimated 10.3% of the country’s GDP.

According to the press service of Turboatom [TATM UZ, HOLD], the largest turbine producer in Ukraine, the Company has reached an agreement with Ukrgydroenergo to modernize the hydro turbines at the Kremenchug HPP. After the modernization process, the hydro aggregate capacity will increase from 58 MW to 62 MW and the HPP’s productivity will increase by 4%. While the period for fulfillment of the delivery is 18 months, the monetary value of this deal has not yet been disclosed.

The Government of Ukraine has increased the amount of compensation for interest payments on loans taken out by agricultural businesses in the national currency from 1 to 1.5 bank-rate of the National Bank. In addition, the government has established a 90% rate of compensation for long-term loans taken out by agrarians in 2009, in either national and foreign currencies, for purposes of capital investment. As of July 1, Ukraine’s agricultural producers had attracted UAH 5.8 bln in loans from commercial banks since the beginning of 2009.

As of October 13, Ukrainian agricultural enterprises had planted 6.6 mln hectares of winter grain crops for the 2010 harvest, representing about 85% of the forecast. The current situation with respect to winter crops is rather complicated. Of the winter wheat seedlings got on 3.3 mln ha, (55% of the total), 27% of those shoots (an estimated 900 thsd ha) are weak and sparse. With regard to the sowing of winter rapeseed, 1.4 mln ha of land was sown with this culture, constituting 105% of the forecast level. However, shoots were obtained on only 75% of this area. Almost 30% of the winter rape seedlings produced are weak and sparse. Farmers plan to sow 9.1 mln ha of winter crops for the 2010 season, compared to the 8.1 mln ha of winter grain and 1.4 mln ha of winter rape that were planted in the previous agricultural season.

The economic court of the Luhansk Region mandated the return of a 76% stake in Luganskteplovoz (LTPL: N/R) to the State Property Fund's ownership. The court obliged the "Center-Registrator" to withdraw the stake of the company from the account of Briansk Machinery and to reinstate the State Property Fund of Ukraine as the owner of the 76% block.

Ukraine exported 7,107 million tons of grain crops since the beginning of the 2009/2010 marketing year (July 2009-June 2010). So, as of October 8, grain exports from Ukraine amounted to 7106.5 thousand tons, whereas as of the same date in 2008 the export was 6889.7 thousand tons. Specifically, 618.2 thousand tons has been exported since early October. In order of their significance, crop exports were as follows: wheat, 3944.9 thousand tons, barley, 2548.7 thousand tons, and corn, 478.3 thousand tons. Ukraine also exported 765.4 thousand tons of rapeseed, compared to 1276.2 thousand tons in the last marketing year. The Ministry of Agriculture predicts in the current marketing year wheat exports may reach about 18 million tons.

Regional power distributing company, Chernigivoblenergo [CHEON UZ, BUY] failed to hold EGM on October 09, as it was banned by the court. The company’s 25% stake was privatised in May 2009. The remaining shares were distributed between two business groups and portfolio investors.

The Government has successfully stabilized the price of sugar: intervention of Agrarian Fund in the commodity market has influenced the price and it went down at the beginning of a new season of sugar-making. In September sugar plants produced sugar at the level of 135 thsd tons. Wholesale price of the plant has fallen from 4900 UAH/t by September 20 to 4700-4750 UAH/t at the end of the month. Retail price dropped from 6,5-7,5 UAH/kg to 5,5 UAH/kg, and the present price of sweet product is stable.