Black sea countries have increasingly gained importance during the past few years on the grain market. While Ukraine, southern Russia and Kazakhstan were once the breadbasket of the Soviet Union, the fall of the USSR has allowed these areas to gain access to the world market and its exchanges. Access to main freight routes through the Black sea, new lands and cheap production costs have therefore brought massive foreign and local investments in the Agricultural sector. Indeed, sky seems to be the limit regarding the production potential of these countries which are benefiting from the vastest chernozem soil reserves and better growing conditions year after year…
FACTORS OF THE SUCCESS
Good soil types for crop production
Investments have brought a new influx to the agricultural production while the production potential increases year after year due to a rising use of precision agriculture, genetic selection but also better mechanization. Furthermore, Russia and Ukraine possess the vastest majority of Chernozem soils which is considered a perfect soil structure for grain crops due to its capacity to retain and release water during dry climatic conditions. These types of soil rich in organic matter, phosphorus and ammonia are one of the key factors of Ukraine’s and Russia’s growing agricultural potential in terms of yield and production.
The previously mentioned factor combined have allowed the black Sea area to drastically increase the wheat production throughout the years. This can easily be seen on the following figure which combines the production of past years for Russia, Kazakhstan and Ukraine. While some heavy fluctuations are still to note throughout the years due to climatic concerns, the rise in wheat production has been clearly seen in Russia and in a smaller proportion in Ukraine.
Nevertheless, the weather factor remains the main uncertainty in this area regarding the production. If no major climatic event has been noted in Russia since 2010, it remains important to integrate this element as a limiting factor for the zone. Furthermore, yields are still subject to strong variation year after as you can see on the following graphic which shows the average yield for the main exporters as well as the minimum and maximum for each one.
If those are just some of the factors explaining the rise of these new agriculture giants, it remains difficult to fully apprehend the potential left in coming years. Supported by a lenient political and economical context, it is certain that producers will thrive in the coming years and become leading actors of the future world agricultural market. This phenomenon has already begun in view of the rising shar of wheat exports from the Black Sea area as shown on the following chart.
You want to know more about the Russian/ Black Sea area regarding agriculture but also have a qualified insight of the production for wheat and other crops, do not hesitate to contact us and to book a seat in our car !