"Bread basket" of Europe is still the world’s third largest grain exporter

"Bread basket" of Europe is still the third largest grain exporter

Ukraine is still the world’s third largest grain exporter, now ranking only after the United States and the European Union, leaving previous grain export giants Russia and Canada behind. 

According to Prime Minister Yulia Tymoshenko, Ukraine harvested a total of 53.3 million tonnes of grain in 2008, and 28.5 million tonnes for 2009.

This came after the news that Ukraine exported 382,100 tonnes of barley in December 2009 (an 8% increase compared to the previous month); while wheat export in December 2009 also grew by 10% compared to November 2009.

Winter crops sowing areas for 2010 also up by 2.1%

Between January and November of 2009, the Autonomous Republic of Crimea in Ukraine produced a total of 655,600 tonnes of grains, a 7.6% increase compared to the same period of the previous year.

Wheat sale volumes went up by 17.6%, barley rose by 8.6%, and rye saw a 0.4% increase, according to the Ministry of Agrarian Policy of the Autonomous Republic of Crimea.

In currency terms, US$525.4 million-worth (4.2 billion UAH) of agricultural products was produced.

Crimea is an agricultural hotspot in Ukraine, possessing fertile soil, well-trained labour, and processing branch capacities.

This came after the news that the sowing areas of grains and green feed for the harvest in 2010 have been increased by 2.1% compared to the index of 2008, currently standing at 646,900 hectares. 

2010 could be another good year for emerging markets

 .

"Emerging markets are really the only place to be," UBS’s Jeffrey Palma told Money Week on 8 January. In 2009, the MSCI Emerging Markets Index hiked by 75%, as emerging markets including Indonesia and China fared relatively well than the developed world.Over the next five years, the Indonesian economy may grow by an average of 6.6% every year and reach 7% by the end of 2014, according to the President Susilo Bambang Yudhoyono. In China, the economy grew 8.5% during 2009 amid the global downturn, according to Zhang Xiaoqiang, vice chairman of China’s top economic planning agency.The news followed Nestle, the world’s largest food company, saying that it is seeking acquisitions in emerging markets.

Grain harvest for 2009 may have already exceeded forecasted numbers

Following a record harvest in the last marketing year, Ukraine welcomed another bumper harvest in 2009, with grain harvest in 2010 poised for a further upgrade.

Ukrainian Prime Minister Yulia Tymoshenko told a press conference that Ukraine "faced poor weather in 2009 but have already harvested 48.5 million tonnes of grain" by the end of the year.

The number forecasted by Ukraine’s Agrarian Policy Ministry was 48 million tonnes following a series of upward revisions over 2009.

Meanwhile, UkrAgroConsult is estimating the 2010 wheat harvest to come in at 18.7 million tonnes; whereas the Association Ukrainian Agribusiness Club is forecasting just 13-14 million tonnes of wheat harvest.

Primary estimation by UkrAgroConsult was due to the fact that dry conditions for autumn plantings did not cause soil temperatures to sink to critical values, and winter crops were not damaged by the frost on most areas.

Measured on a per capita basis, few countries have as much agricultural land of such quality as Ukraine, though almost half of the total area is still owned by the state.

The growing number of Ukrainians who now own titled plots of land faces policy makers with the questions of what is farm land worth in Ukraine, what rights and responsibilities do owners of farm land have and can the land be sold.

A functioning land market is vital as it ensures that land can move to more efficient operators and can fulfil its role as a source of revenue for pensioners and others in rural areas who may not have alternative sources of income.

In Western countries the fundamentals of farmland price determination are an essential part of the education of students of agricultural economics. As there was no land market in Ukraine for many decades prior to independence it is no surprise that these fundamentals are not widely understood.

This paper outlines how land markets function and how farmland values are determined in market economies. It describes the links between agricultural policy and land prices, discusses government policy with respect to farmland in Ukraine and ends with a series of recommendations.

Download PDF

Source:Institute for Economic Research and Policy Consulting – http://www.ier.kiev.ua

The outlook for agriculture has rarely, if ever, been more favorable. First, world economic growth is projected to increase at a 3.5-percent average annual ratebetween 2008 and 2017, after averaging 2.9 percent annually in 2001-07. Strong economic growth in developing countries, particularly important for growth in global food demand, is projected at 5.8 percent annually for 2008-17.

While agricultural experts agree that it’s very unlikely that prices in the marketing year 2009/10 will surpass the previous year’s benchmark, Ukraine is showing strong signs of bumper crops and an excellent harvest meaning that investment in Ukraine land is set for another good year.

According to the ‘Ukraine Grain and Feed Annual Report 2009’, last year’s bumper crop and large carryover stocks led to export sales being taken to a historic high. These exceptional export levels meant that Ukraine joined the listing of the world’s top grain exporters. Figures released by the Ukraine State Statistical Committee show that grain production in the 2008/09 marketing year experienced a massive 82% year-on-year rise.

The increase in the area of Ukraine land used for agriculture (in particular, grain and pulse crops) was also considerable (14.4% more land was farmed) while yields grew by an impressive 59.2%. Exports are expected to be slightly lower this year, but the Ukraine government estimates that the country’s grain exports will amount to around 7 million tonnes of grain, the second highest level ever and well above average. Part of the reason behind this export boom comes from favourable climatic conditions.

Last winter saw ideal weather in Ukraine for crop planting. The mostly mild conditions have led to 95% of the winter crop being classed as ‘good’ or ‘satisfactory’ by the Ukrainian Meteorological Center. The figure is the highest for the last four years and augurs well for crop yields farmed from Ukraine land during the 2009/10 marketing year. Another factor behind the record grain export levels produced by Ukraine land is the improved grain storage facilities.

Ukraine agriculture is fast catching up with modern technology and techniques. Better and bigger storage is a top priority, particularly when yields are high. Total storage capacity increased by 2 million tonnes last year with the construction of more silos and grain elevators planned for this year. Ukraine’s admission to the World Trade Organisation (WTO) in 2008 was a further contributing factor to Ukraine’s high grain exports.

Membership of the WTO has meant Ukraine has had to adopt international export licensing requirements and abolish grain export restrictions. Agricultural experts are unanimous in that agriculture on Ukraine land has a very bright future. Ukraine is one of the very few countries in the world where vast agricultural expansion will not have a negative effect on the environment. Ukraine also enjoys the privilege of some of the world’s most fertile soil.

In addition, improved farming techniques will ensure that Ukraine continues to produce high crop yields over the next decade and beyond. And with world food consumption forecast to increase by over 40% by 2030, Ukraine land and the soft commodities produced on it are poised to become an essential part of everyday life.

Socially responsible investing (SRI) spans a wide and growing range of products and investments, from stocks and bonds, to savings, checking and other banking accounts, to venture capital. Like all investors, socially responsible investors seek a competitive financial return on their investments, and the good news is that it is possible to consistently achieve this.

A growing number of academic studies have demonstrated that SRI mutual funds perform competitively with non-SRI funds over time. Several of these peer-reviewed and published studies have been awarded the prestigious Moskowitz Prize. Additionally, more than 20 studies demonstrating that SRI mutual fund performance is comparable to that of non-SRI funds can be found at www.sristudies.org — a compendium of all the major academic studies on SRI.

Another indication of the competitive performance of SRI funds is the performance of SRI indexes. These indexes are designed to be benchmarked to non-SRI indexes, such as the S&P 500. The longest-running SRI index, the Domini 400, was started in 1990. Since that time, it has continued to perform competitively — the S&P 500 with 10.33% total returns, versus the 10.83% return of the Domini 400. For up to date information on the performance of SRI funds that belong to the Social Investment Forum.

The rapid growth of SRI in recent years is the best evidence that socially responsible investing yields competitive returns. Over the past 20 years, the total dollars invested in SRI has grown exponentially, as has the number of institutional, professional, and individual investors involved in the field. Between 1995 and 2007, total dollars under professional management in SRI grew from $639 billion to $2.71 trillion, outpacing the overall market. SRI investing has become part of the mainstream, and as a result, a number of conventional companies now offer SRI products to their clients. The bottom line is that more and more investors adopt and use SRI strategies not only because such investments allow a focus beyond the bottom line, but also because returns are comparable to those of more conventional investments.

Ample evidence of the competitiveness of SRI is also found in the increasing investment in SRI by state pension funds, university endowments, and foundations. These fiduciaries are obligated by law to seek competitive returns for the portfolios they manage. The fact that a growing number of major U.S. fiduciaries are either screening their portfolios, engaging in shareholder advocacy, or directing assets to community investing, demonstrates that these three SRI strategies do not impede financial returns.

Princess Project site cleared

Updated on Monday 14th of September 2009

Silva Tree staff

The plot of land purchased for the first phase of the Silva Tree Princess Project in Panama has been cleared and cleaned in preparation for planting of the seedlings. Staff have been contracted from the local population for both the clearing and the planting of the land and are standing by for the arrival of the Paulownia seedlings.

The project site has been used as cattle grazing land for many years and, as such, contained little visible plant life, limited to just brush, grass and small bushes. Strong weeds, bushes and grasses can create competition for young seedlings, however, so the land had to carefully cleared and prepared for planting.

Care has been taken to ensure that any native trees or important plants in terms of animal migration, bio diversity or protected species, have been left to stand. Similarly, a patch of trees by the stream that flows through the land has been left to maintain its banks and water quality.

To see latest images of the cleared land, please go to our new online photo diary at www.sterlingknightconsultants.com

New Photo Diary Feature

Updated on Monday 28th of September 2009

Silva Tree staff

Silva Tree believe in involving everyone in our projects’ progress. We want you to be able to see exactly what we are doing and when. Since the project is in a fairly remote location and the ability for our customers and supporters to visit it is limited, we decided to bring the project to life via our website.

You can now track the progress of the Princess project online via our photo diary. This feature contains images and captions of what is happening to the project and is updated at every significant development, from community projects to planting and watering.

A link to the photo diary can be found on the Silva Tree home page: www.silvatree.com or use the following url to view the photo diary now: http://www.silvatree.com/photo-diary.html

We hope you enjoy this new feature, please let us know if you have any suggestions on how to further involve you in the Princess project progress.

According to Eric Borremans, senior fund manager at BNP Paribas Asset Management, the best places to put one’s money these days is water resources, wind power and energy-saving light-emitting diodes – industries now seeing massive investment by governments around the world.

Borremans, the asset manager’s head of sustainable investment, said governments around the world are rolling out new policies to boost green industry, but stressed investors need to be cautious in choosing which companies and specific areas benefit from this new landscape.

“Now is the time to invest in green industries, where global resources will be concentrated,” Borremans said during his latest visit to Seoul. BNP Paribas, a French asset manager, operates a local joint venture called Shinhan-BNP Paribas with Korean financial behemoth Shinhan Financial Group.

As the economic downturn raged, major economies including the United States, Japan and European nations rushed to roll out stimulus packages, and most of them contained support for green growth. Borremans estimated these countries will invest up to $400 billion in green growth industries over the next three to five years.

“It is double the [current] size of the world’s environmentally friendly industries,” he said.

Particularly promising areas are water, wind power and LED lighting, all of which are seeing massive spending by the American government.

The U.S. is aggressively developing wind power resources, as is China, while LED lighting has the potential to improve the energy efficiency of buildings, Borremans said.

But the future of some industries long considered green up-and-comers, such as biofuel and solar power, may not be as bright as once thought, the fund manager said. Biofuel suffers from a worsening reputation amid criticism that its production fans global crop price hikes and food shortages in poor countries, while the solar energy industry is struggling with a supply glut as hundreds of solar panel makers are competing to expand their presence in a market that is still of limited size.

Borremans added that now is also the time to pay more attention to green tech companies in Asia, which suffers from brutal pollution. Demand for technologies to preserve the environment during and after industrialization will come from these Asian countries rather than Western companies.

Borremans, who manages the BNP Paribas funds investing in environmentally friendly companies, sold here as the “Shinhan-BNP Paribas Bonjour Clean World,” said he is currently investing in Taewoong, a local wind power technology company.

Russia and other former Soviet countries such as the Ukraine could boost world food supply by encouraging more private investment, the head of the European Bank for Reconstruction and Development (EBRD) said on Saturday.

The EBRD believes at least 13 million hectares of former farmland could be returned to production across Russia, Kazakhstan, Ukraine and other countries. Just under half of this land is in Russia. "The investments remain enormous. Under the current circumstances such financing is difficult to obtain," EBRD President Thomas Mirow told Russian President Dmitry Medvedev at the World Grain Forum in St Petersburg.

Medvedev said Russia, the world’s third-largest wheat exporter, was ready to devote financial resources to strengthen its position on world grain markets. Last week he said Russia supported long-term foreign investment in its agriculture.

The world’s No. 5 grain producer also plans to raise its output by some 25 percent to 133-136 million tonnes a year in the coming years to contribute to global food security. The EBRD, state-owned by 61 countries, believes poor infrastructure, such as limited capacity on railways and grain elevators, as well as unclear legislature, are hurdles to unlocking the countries’ enormous food potential.

"The (financial) crisis has enhanced the role of the state and one of the lessons will be that a functioning market needs good and workable regulations," Mirow said. Last week Medvedev said Russia intended to enter Southeast Asian markets and to diversify its export mix by raising its share of processed grain products, specifically flour and groats.

With recent focus of the BBC and other international media on farmland investment in the Ukraine, the question of how safe it is to invest money in the Ukraine is often put to our portfolio managers.

Ukraine is still very much an emerging market and needs to improve on internal political and economic stability. However, this goes for most former ‘East Block’ countries.

Financial and Economic Outlook

Ukraine’s membership of the WTO in 2008 and the subsequent launch of negotiations for an FTA (as part of the future Association Agreement) are expected to deepen an already promising economic partnership.

The Executive Board of the International Monetary Fund (IMF) approved a in August last year a two-year Stand-By Arrangement (SBA) for SDR 11 billion (about US$16.4 billion) to help the authorities restore financial and economic stability and strengthen confidence.

Political Stability

An other reason for concern with some investors is the fact that the Ukraine is ,located close to Russia and the Georgia incident is still fresh in many people’s mind.

Vladimir Putin told Spanish journalists that if Ukraine is accepted to the EU, as it desires, Russia will be happy. “Indeed, Russia and Ukraine have close relations in economy and cooperate in the industrial sphere. So, incorporation of the Ukrainian economy into the EU economy is likely to have a positive result for Russia as well,” Vladimir Putin said.

The European Union today is the Ukraine’s largest trading partner.

Research & Resources

For more information about the economic and political stability in the Ukraine we invite you to check out the following articles.

• IMF Approves US$16.4 Billion Stand-By Arrangement for Ukraine
• World Economic Forum and Foundation Announce Release of 2009 Competitiveness Report
• IMF Allocates Ukraine USD 1.6 Billion
• Russia welcomes Ukraine’s EU membership
• Closer ties between Ukraine and EU

Socially responsible investing (SRI) spans a wide and growing range of products and investments, from stocks and bonds, to venture capital. Like all investors, socially responsible investors seek a competitive financial return on their investments, and the good news is that it is possible to consistently achieve this.

Economic Studies Confirm that SRI Outperforms NON-SRI

A growing number of academic studies have demonstrated that SRI mutual funds perform competitively with non-SRI funds over time. Several of these peer-reviewed and published studies have been awarded the prestigious Moskowitz Prize.

Additionally, more than 20 studies demonstrating that SRI mutual fund performance is comparable to that of non-SRI funds can be found at www.sristudies.org — a compendium of all the major academic studies on SRI.

Another indication of the competitive performance of SRI funds is the performance of SRI indexes. These indexes are designed to be benchmarked to non-SRI indexes, such as the S&P 500. The longest-running SRI index, the Domini 400, was started in 1990. Since that time, it has continued to perform competitively — the S&P 500 with 10.33% total returns, versus the 10.83% return of the Domini 400.

Rapid Growth of SRI

The rapid growth of SRI in recent years is the best evidence that socially responsible investing yields competitive returns. Over the past 20 years, the total dollars invested in SRI has grown exponentially, as has the number of institutional, professional, and individual investors involved in the field. Between 1995 and 2007, total dollars under professional management in SRI grew from $639 billion to $2.71 trillion, outpacing the overall market. SRI investing has become part of the mainstream, and as a result, a number of conventional companies now offer SRI products to their clients.

The bottom line is that more and more investors adopt and use SRI strategies not only because such investments allow a focus beyond the bottom line, but also because returns are comparable to those of more conventional investments.

Ample evidence of the competitiveness of SRI is also found in the increasing investment in SRI by state pension funds, university endowments, and foundations. These fiduciaries are obligated by law to seek competitive returns for the portfolios they manage.

The fact that a growing number of major U.S. fiduciaries are either screening their portfolios, engaging in shareholder advocacy, or directing assets to community investing, demonstrates that these three SRI strategies do not impede financial returns.

Over the past 50 years, forestry returns have shown a positive growth. In recent decades, timber has been one of the best assets to own. As reported by Bloomberg Wealth Management:

"Timber has quietly and consistently out performed nearly all other commodities for the past 100 years"

Given the recent turmoil in the more traditional markets, investors are increasingly looking towards commodities for medium to long term security, whilst realising a high annual return on investment (ROI). Since the collapse in the property investment market, timber production has proven to be the perfect partner to introduce stability and diversity to existing portfolios.

Forestry really is the best alternative investment in today’s economic climate !

Forestry Investment and Timber Production – The Perfect High Yield Investment

Whether you are looking for a long term investment or an investment that pays you a consistent income throughout it’s lifetime, timber production through sustainable forestry is an option you should consider.

Forestry Investments

• Low Volatility
• Real Diversification For Your Portfolio
• SIPP Compliant
• Environmentally & Ethically Attractive
• Short, Medium and Long Term Options

The Best Investment For Your Money

For the past several years, one of DailyWealth’s biggest "themes" has been the advantage of investing in timber and hardwood .. Timber prices are extremely stable… and they aren’t correlated with the stock market. Trees grow constantly. If timber prices are weak, the timberland owner can simply let his grow. These qualities make timber a fantastic medium to long term investment,

The Princess Project from Silva Tree.

For more information, to download Sterling Knight Forestry & Timber Investment brochures and research reports visit The Princess Project Download Page.

In the current property and financial climate, sustainable forestry projects offer a low-risk investment opportunity with additional environmental benefits. The Princess project is the only timber investment to offer guaranteed returns payable in just 5 short years.

Introducing the Princess Project – Paulownia Forest.

The Princess Tree, officially known as Paulownia, is recognized as the fastest growing hardwood in the world. The timber it produces is durable and strong, lightweight and fire resistant.

Unlike other Tropical timbers, the demand for Paulownia is not being met by abundance of plantations and, as a carbon reducing facility; it absorbs more CO2 than any other Tropical plantation tree.

The world market price, supply and demand, speed of growth and quick return on investment make Paulownia an ideal commercial plantation tree. Moreover, a buyer for the timber has already been found with a bonded purchase guarantee in place, ensuring your investment return is completely guaranteed.

Private investors are invited to join in this project by purchasing individual plots of land providing net returns of up to 16.8% per annum over a total investment period of twenty years (applicable to investments made before the 1st January 2010).

This is not just an exceptional financial investment, buyers can enjoy a variety of tax breaks, assurance of security and enjoy the environmental benefits and community initiatives facilitated by the project.

Key points

• Low investment amount from just 30,000 US$ per unit
• Gross return of 145,200 US$ over 20 years
• Guaranteed returns of up to 16.8% p.a. for 20 years
• Returns paid every 5 years
• Tax advantages
• SIPP qualified
• CO2 climate change mitigation
• Benefits to local communities
• Land held in trust
• Timber buyer with bonded guarantee

Based on introductory purchase price of 30,000 USD applicable to all purchases made before 01.01.2010, please see “investors safety” section for details and definitions.

Investment returns

• The investor will receive 660 trees per hectare of land purchased
• A lease will be registered in his/her name for 21 years, which will produce 4 timber harvests
• A purchase price of USD 275 per m3 of timber is guaranteed by World Paulownia LLC, if the investor wishes to take this option
• A 5-year old Paulownia tree produces at least 0.2m3 of processed wood
  The total m3 produced per plot over the 4 harvests is 528 m3
• Based on a 30,000 USD investment (available until end Dec 2009), this will provide a return of USD 145,200 per plot
• The harvesting, processing and transportation will be carried out by a management company of your choice
  (unless you wish to organise it yourself) which is likely to charge 10% of the value of your timber sales
  After this has been deducted the investor will receive a gross return of 21.8% per year
• This produces a net return of 16.8% per annum over 20 years, after the initial investment amount has been deducted

For more information, to download brochures and research report visit The Princess Project Information Pages.