July 5 (Bloomberg) -- Ukraine, the third-biggest corn exporter, lowered its corn-crop estimate by 8 percent because of hot weather damage.
The crop will be 23 million to 24 million metric tons, Agriculture Minister Mykola Prysyazhnyuk said in an interview in the capital, Kiev, yesterday. The ministry’s previous estimate on June 20 was 25 million to 26 million tons. The soybean crop may climb 70 percent, he said.
“Ukraine increased corn plantings this year but unfortunately abnormal weather has not left Ukraine aside,” Prysyazhnyuk said. “For this year we see the minimum corn harvest of 23 to 24 million tons.”
Ukraine’s corn yields may drop below 5 tons per hectare (2.47 acres) because of the heat, according to Tetiana Adamenko, the head of the agriculture department at Ukraine’s weather center. Yields averaged 6.4 tons per hectare last year, the ministry estimates.
Corn futures rallied 38 percent since June 15 in Chicago as crop conditions in the U.S., the biggest corn producer and exporter, worsened on hot, dry weather. Global demand for the grain has expanded for 16 consecutive years and will be a record high of about 865.5 million tons in the 12 months ending Oct. 1, the U.S. Department of Agriculture estimates.
Corn futures have climbed 8 percent this year to $6.985 a bushel on the Chicago Board of Trade, the highest level since Sept. 20. About 48 percent of U.S. corn was rated good or excellent as of July 1, the lowest for the date since 1988, according to the USDA.
Ukraine may export about 15 million tons of corn in the 12 months ending in June 2013, including 4 million tons from the previous crop, Prysyazhnyuk said. This compares with 13.5 million tons in the previous season.
The country’s exports may come to 14 million tons in the 12 months through September 2013, unchanged from a year earlier and making it third after the U.S. and Argentina, the USDA estimates. The country’s corn crop may rise 5 percent to 24 million tons in the 2012-13 season, according to the USDA.
“The situation is far from optimal,” Adamenko said by telephone yesterday. “The plants are still suffering from heat stress. The weather is going to be hot, and the rains won’t be significant.”
The next six weeks will be important for plant development, according to Rabobank International, which estimates Ukraine’s corn crop for 2012-13 at 22 million tons, down 500,000 tons from the previous season because of lower yields and dryness in the southern parts of the country.
Ukraine may ship about 2 million tons of corn to China from 2013 and targets total exports of about 20 million tons a year by 2015, Prysyazhnyuk said. Ukraine’s production of the grain may jump to as much as 37 million tons by 2015 on increased yields and improved seed and fertilizer use, he said.
China’s corn imports may jump 40 percent to 7 million tons in the 2012-13 season, according to the USDA. Japan and South Korea, the top and the third-biggest importer, may also increase purchases, the USDA said. Mexico is the second-biggest corn importer.
The country’s farmers planted 4.6 million hectares of corn for the 2012 harvest, according to Agriculture Ministry data. Ukraine seeks to have about 5 million hectares of the grain by 2015, Prysyazhnyuk said.
Ukraine’s soybean crop may jump to as much as 3.9 million tons this year, from 2.3 million tons in 2011, he said. Farmers boosted areas under soybeans by 25 percent to 1.34 million hectares this year, according to Ukraine’s statistics service. The USDA forecasts Ukraine’s soybean crop at 2.7 million tons in the 12 months starting Sept. 1.
The ministry expects there to be about 2 million hectares of soybeans by 2015, Prysyazhnyuk said. The government is considering how to prevent farmers from reducing barley areas, with one option involving sales through forward contracts. The country “needs” to have at least 4 million hectares of barley plantings and targets annual production of 12 million to 13 million tons by 2015-16, he said.
Ukraine may supply 2 million to 3 million tons of barley a year to Saudi Arabia, the world’s biggest importer, Prysyazhnyuk said.