The Black Sea region combining Russia, Ukraine and Kazakhstan probably exported more grain than the U.S. for the first time as weak currencies and bumper crops made their shipments cheaper for foreign buyers, said market researcher UkrAgroConsult.
The region is set to be the world’s biggest grain exporter, with sales seen at a record 80 million metric tons in the 2015-16 season ended in June, the Kiev-based consultant said in an e-mailed report.
Deliveries from the U.S. are seen at 75.4 million tons, according to the International Grains Council, which has a lower forecast for the Black Sea of 73.2 million tons.
“Such a substantial increase in export shipments took place amid record-low export prices for major grain crops,” UkrAgroConsult analyst Marina Sych said in the report. “Traders significantly increased the grain volumes sold to obtain comparable profits.”
Exports from Ukraine, Russia and Kazakhstan rose 14 percent from a year earlier, the researcher said. Russia boosted sales to Arab countries; Ukraine to Thailand, Indonesia, China and the European Union; and Kazakhstan to Iran, Turkey and China, Sych said.
Wheat accounted for more than half of Black Sea sales, or 45 million tons, according to UkrAgroConsult. That’s 29 percent of global trade in the cereal and higher than the European Union’s exports.
“It’s a milestone for the Black Sea,” Matt Ammermann, a commodity risk manager at INTL FCStone Inc., said by e-mail. “The Black Sea has always been susceptible to weather risk, a bit more than Western Europe and the U.S. due to farming practices. As these practices become more efficient, yields should become more stable.”