Despite Decreased Production, Buckwheat Exports from Ukraine Rebound in 2019

Buckwheat

Russia

Published Jan 2, 2020

Buckwheat production in Ukraine is decreasing significantly: the total amount of fields on which buckwheat was planted has been reduced by almost 90% over the last 20 years. This drastic reduction in acreage is associated with increased cheap imports from Russia, as well as high production costs domestically. Surprisingly, exports of buckwheat have picked up this year.

Decrease in Buckwheat Production

Between 2000 and 2019, the total area planted for buckwheat decreased from 570K ha to only 60K ha. The basic underlying reason is that buckwheat is no longer profitable to plant: costs are too high and prices too low. Production costs of buckwheat have increased immensely. For one hectare of land, farmers have to pay UAH 3,000 (USD 126.5). Together with the costs for irrigation and seeds, the minimum cost price easily goes over UAH 6,000 per ton (USD 253,0).

The high production costs make it hard for Ukrainian buckwheat producers to compete with Russian imports. Around 60% of all buckwheat sold in Ukraine comes from Russia and these imports are often sold for less than UAH 6,000 per ton, leaving no profit for Ukrainian farmers. Combined with a lower consumption domestically, around 3.5kg per person per year, many buckwheat farmers have decreased their planted acreage. There is also a lack of consistent government support for non-traditional niche crops, such as buckwheat, millet, and rye.

Increase in Exports from Ukraine

Interestingly, the price for buckwheat has picked up. Since 2017, the price has declined by 2.7% monthly, due to the low consumer demand. However, in 2019, the price for buckwheat has increased rapidly, by approximately 8%. This price increase is due to increased demand from abroad. Although buckwheat imports into Ukraine are increasing, exports almost doubled in 2019. The main buyers were Poland, Germany, and South Africa. Despite the price and export increase, the future of buckwheat in Ukraine remains uncertain.