The production and export of rapeseed oil becomes one of the most profitable sectors in Ukraine. Ukrainian fertile soil makes it possible to cultivate rapeseed and to get great volumes of harvest. In addition, the growing demand for rapeseed oil in a wide range of countries boosts this commodity production in Ukraine.
At present, almost all rapeseed oil produced is being exported. In this case, the European Union is the main importer of Ukrainian rapeseed oil. In 2014/2015 MY the European countries share of this oilseed crop and its by-products export equated 66 per cent.
In a new season, the structure of European import was following: the main buyer was France, which purchased 47 per cent of general volume exported. Another important buyer, the Netherlands, imported 18 per cent of Ukrainian rapeseed oil. Additionally, Poland and Belgium bought 8 per cent of oil produced each.
At the same time, Ukraine has established trade connections with several East and South Asian countries. During 5 consecutive seasons, Ukraine has significantly increased its rapeseed export to this region. For instance, in 2010/2011 MY the share of the Asian countries in Ukrainian export was estimated at 1 per cent. However, in 2014/2015 MY this figure equated 23 per cent.
In 2015/2016 MY the share of these countries has increased again. In this case, China and India became the most promising markets. Data reveals, that in July-September of the current year China imported 33 per cent of Ukrainian rapeseed produced. As for India, it purchased 15 per cent of this commodity. It is also interesting, that the Asian partners usually purchase food rapeseed oil, while the European countries prefer to import technical oil.
However, Ukraine is to reduce the volume of rapeseed export. According to the analyst of APK Inform Agency, Andrew Kupchenko, this autumn planting campaign was marked by unfavorable weather conditions. What is more, inappropriate weather conditions were raging in spring, which has led to the harvest losses, estimated at 25 per cent.
In accordance with APK Inform, Ukraine exported 89,700 tonnes of rapeseed during first months of this year. This figure is far less in comparison with previous year, when Ukraine supplied to the foreign markets approximately 300,000 tonnes of oilseed.
The analyst also said that the forecast for rapeseed harvest in 2016 is not that optimistic. The decline, estimated at 35 per cent in comparison with the current season, is anticipated. The volume of yield in 2016 is expected to be 1.1 million tonnes, while in 2015 it equated 1.7 million. Therefore, the production of rapeseed oil is also to decrease by 29 per cent. This figure is expected to equate 105,000 tonnes in 2016, while in 2015 129,000 tonnes of oil were produced.
As it was mentioned before, the weather conditions during this autumn were unfavorable for rapeseed sowings, which has caused the drop in sown area. In last year, 885,000 hectares were sown with rapeseed. However, only 626,000 hectares were sown in 2015. Though the average yield of rapeseed was quite high (2.16 tonnes per hectare), it was not enough to compensate the sharp decline in the area sown.
Despite all these obstacles, the production of rapeseed and its by-products in Ukraine remain one of the most promising sectors. The low prices for these commodities make them more and more popular in a wide range of countries. Therefore, new markets become available, which boosts production and export. What is more, rapeseed oil can be used for both food and technical purposes, which leads to the growth of demand for this product. That is why analysts believe that this sector should be further developed in Ukraine.
In summary, the production of rapeseed in Ukraine is facing a challenge at present. Unfavorable weather conditions have caused the losses of harvest and the decline in sown areas in comparison with previous year. It will definitely lead to the decrease of yield volume in 2016. However, this sector of Ukrainian economy remains promising, as Ukraine has won new markets in order to export its rapeseed production.
