News
31.08.2010
Ukraine. Agrarian Fund expecting lower prices for grain
Due to a sharp jump in grain prices, Agrarian Fund has suspended purchases of grain. This was reported during an open meeting on agriculture by Deputy Prime Minister for Agriculture Viktor Slauta. The price of the third-class wheat in the domestic market has already reached USD 1,800/ton (1 USD - 7.89 UAH).
According to Agrarian Fund CEO Oleksandr Marenets, 135 thousand tons of grain has been purchased. This is food grain, wheat of the second and third classes, which primarily will be used for processing and providing the bakers with flour at fixed prices.
He also noted that the prices at which the AF provides producers with corn are market. 'In determining the minimum prices, we took a market approach," he said, adding, "I'm not going to say that each household has its own cost of wheat, but as for me it should not be above 700 UAH per ton, or even lower. Therefore, if today the price of the Agrarian Fund, for example, on the wheat of third class is approximately 1,500 UAH, I believe that for a 100% return this is enough."
According to Slauta, today forward and secured purchases should be the prerogative in the work of the Agrarian Fund. "Agrarian Fund must work on forward, possibly on futures contracts, as well as make mortgage purchases... It is difficult to work on spot contracts due to frequent price fluctuations in the market. Collateral purchases will allow farmers to draw resources for planting," Slauta said.
Another state operator, the State Reserve, is not confused by the current market prices. August 31, it will hold an open tender for the purchase of grain. In particular, the State Reserve is planning to purchase 150 thousand tons of wheat class 2, 140 thousand tons of wheat class 3, and 4 thousand tons of rye.
ukrinform
