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Ukraine drought cuts Astarta's sugar beet harvest hopes
Aug. 23, 2012
Astarta Holding cut hopes for grains harvest, and lopped 20% from its hopes for sugar beet output, as the Ukrainian farming giant revealed it had fallen foul of the "negative" weather which has dented national yields.
The dairy-to-soybean processing group, which this season sowed crops on 236,000 hectares, cut by 100,000 tonnes to 600,000 tonnes its forecast for it grain and oilseed harvests.
Wheat yields, at "approximately" 4 tonnes per hectare, had fallen by nearly 11% year on year, although they remain higher than the national average, pegged by Ukraine's farm ministry two weeks ago at 2.90 tonnes per hectare, a decline of 15.7%.
For sugar beet, Astarta, Ukraine's top sugar producer, cut its forecast for the crop by 500,000 tonnes to 2m tonnes.
'Extremely dry and hot'
The downgrades reflected weather that was "negative" for the group's farmers in eastern Ukraine, "as the summer months of June and July were extremely dry and hot.
"Drought in eastern and southern Ukraine affected the harvest in our fields in the Poltava and Kharkiv regions."
The comments follow a second drought-hit season for Black Sea grain production in three years, with Ukraine's wheat harvest estimated by the country's farm ministry at falling 27% to 16.3m tonnes.
In Romania, farm operator FirstFarms on Tuesday unveiled a hit to yields from poor weather.
However, Astarta forecast that impact on its revenues would be limited, saying that the rally in crop prices, fuelled by Black Sea as well as US droughts, "will offset the lower harvest outlook".
Sugar recovery?
This forecast held for sugar too, despite Ukrainian prices remaining "surpressed", after a bumper 2011 beet crop, and falling by more than one-third over the past year.
However, Ukraine beet production looks set to fall rapidly this year thanks to the poor weather and a drop in sowings, which, at 460,000 hectares, dropped some 15% year on year.
"The expected underproduction of sugar and depleting inventories should stimulate a recovery of the domestic sugar price," Astarta said.
Source: Agrimoney
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