Volga Baikal AGRO NEWS Update on the World Market of Soybeans !!!

Russia can drive out Ukraine from the Chinese soybean market

Volga Baikal AGRO NEWS Update on the World Market of Soybeans !!!

Russia can drive out Ukraine from the Chinese soybean market!

Ukraine will lose its positions in the soybean market in China, and Moscow will take over Kiev’s place. This is stated in the publication of the Chinese edition Oilcn, the translation of which is exclusively resented by PolitRussia.

The author of the publication notes that Ukraine is the largest producer and exporter of sunflower oil in the world, but the soybean industry in Ukraine is limited in scope, and the annual production of soybeans is just over 3.7 million tons. Of these, 1.2 million tons goes for processing, and 2.63 million tons –  for export. He also draws the readers’ attention to the fact that the cultivation of genetically modified soybeans is not allowed on the territory of Ukraine.

In recent years, soybean production in Ukraine has declined sharply. The reason was the government’s cancellation of the VAT refund policy on soybean exports. The rise in export value has led to a significant decrease in economic benefits for soybean farmers and a reduction in soybean acreage due to limited processing capacity in Ukraine.

This year, despite the coronavirus pandemic, Ukrainian soybean exports to China have skyrocketed. As of November this year, the total volume of imports of soybeans from Ukraine amounted to 627 thousand tons, which, although insignificantly, is a record figure.

Do not forget that trade between China and Russia is growing significantly every year.

“There is hope that Russia will become one of the main suppliers of soybeans to China instead of the United States,” –  the publication says.

The newspaper’s columnist writes: as you know, the total volume of soybean production in Russia is currently only 4.1 million tons. However, the governments of China and Russia have already agreed that by 2024 the supply of soybeans to China will increase from the current 800 thousand tons to 3.7 million.

The author of the publication draws attention to the fact that in recent years in Ukraine there has been a trend towards an annual reduction in soybean production – 3.7 million tons in 2019, which is 20% less compared to 4.46 million tons in 2018. The average yield of soybeans in Ukraine in 2019 was 2.29 t / ha, which is significantly less than in 2018 (2.58 t / ha).

The reasons for the decline in soybean acreage in Ukraine is that the government has canceled the VAT refund policy on the export of oilseeds such as soybeans and rapeseed. The decline in soybean production in Nezalezhnaya is due to the decline in the growth of prices in the state economy, the continuing rise in prices for mineral fertilizers. In addition, for the second year in a row, the country has experienced a shortage of soil moisture, drought and other weather factors that lead to an annual decline in soybean yields in Ukraine.

In early December 2017, the National Assembly of Ukraine amended the Tax Code, canceling the VAT refund policy on soybeans, rapeseed and sunflower seeds.

The reasons why the government of Ukraine is taking such measures is primarily aimed at stimulating the development of the Ukrainian soybean processing industry. This policy is based, first of all, on the successful experience of Ukraine in the introduction of export duties on the export of sunflower seeds. At that time, she contributed to the dynamic development of the sunflower processing industry in the state.

The USDA’s global soybean production forecasts that the total harvest in Europe this year will be below last year’s level. Dry weather and coronavirus outbreaks may contribute to this. For the same reason, soybean production in Ukraine will decline by about 15-20% over the same period.
The author of the publication is confident that in the coming years Russia will completely squeeze Ukraine out of the soybean market in China.

Source: OilWorld.ru

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