Cancel "soy edits" will allow traders to buy soybeans and canola for the hryvnia

In Ukraine came into force the law №466-VIII, abolishing the so-called "soy dressing", and now the exporters will receive a refund of VAT when children apply for the hryvnia of soybean and rapeseed. However, due to the delay with signing of the law, the farmers have reduced the acreage of soybeans, which were reduced in recent years.

at the moment soybeans planted 1.25 million hectares of the planned 1.4 million ha, while in 2017 it is planted 2 million hectares in 2018 1.73 million hectares in 2019 – 1.6 million hectares. the decline in acreage is also affected by lack of precipitation caused by the deterioration of the yield and lower than that of sunflower, the profitability of cultivation.

Even the increase in the processors ' purchase prices for soybeans to 12500-12600 UAH/t with delivery to the plant is not added to farmers to increase acreage of soybeans because the price of it in October-November did not exceed 9500-9800 UAH/t with delivery to the plant.

Active soybean exports in the first half of the season traders who bought it only for the currency has forced processors to increase prices to attract the desired volumes.

For delaying the President signing the law from February to may, market participants did not understand the prospects of the export of oilseeds in the new season. If the law is not in force, the price of rapeseed collapsed as prices for soybeans in the fall of 2019, because the domestic industry has sufficient capacities for processing of rapeseed, and the basic amount is exported to the EU, where it produces biodiesel, while receiving state subsidies.

the Purchase price of rapeseed in Ukraine increased in comparison with the previous year to 395-400 $/t delivered to port amid forecasts of yield reduction due to loss of crops because of drought.

amid the recovery in oil demand and automotive fuel by weakening the quarantine most of the European countries, the August rapeseed futures on Euronext in may increased by 10 €/t to 373,25 €/t or 407,8 $/t. Considering that in January the quotations reached 392 €/ton, prices have the potential for growth in case of shortage of supply.

at present, experts are watching the situation in Canada, where the cold and precipitation are not the optimum time to sow canola. Months of good rainfall in Australia enhance the prospects of rapeseed crop.