Ukraine Grain Harvest Seen by Azarov Down 8 Million Tons

Ukraine’s grain harvest in 2012 may be 8 million metric tons less than last year because of weather- damage, Prime Minister Mykola Azarov said.

The eastern European country will still have enough grain for prices to remain stable, Azarov said today in the eastern city of Zaporizhzhya, according to a statement on his website.

“Because of difficult weather conditions this year, the grain harvest will be 800,000 tons less than last year in the Zaporizhzhya region,” Azarov said. “The harvest will be 8 million less in the current year on the whole territory of Ukraine than last year. But unlike in 2003-2010, now we have sufficient grain stockpiles that would allow a stable price policy.”

Ukraine reaped a record 56.7 million tons of grain last year. The former Soviet state may gather 45.3 million tons this year as a dry autumn, cold winter and summer drought have damaged crops, according to the agriculture ministry. The government has said it won’t limit exports as it did in 2010, when the harvest fell to 39.3 million tons following drought.

The agriculture ministry and traders signed an agreement on July 31 under which the government undertook to give exporters two months’ notice should it decide to restrict shipments abroad in the marketing year that began July 1.

“The state is interested in a stable grain market,” Agriculture Minister Mykola Prysyazhnyuk said in a statement on the ministry’s website. “We will work together to control grain exports this marketing year. For example, if more than 80 percent of potential export volumes are shipped, we will think how to act further.”

Ukraine’s weather center cut its grain harvest forecast to 43 million tons because hot weather reduced yields, it said July 24.

To contact the reporter on this story: Daryna Krasnolutska in Kiev at dkrasnolutsk@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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