Ukrainian crop production estimates revised upward as harvesting concludes

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Ukraine’s counteroffensive saw few territorial gains in August. However, Ukraine has increased the frequency and intensity of aerial attacks on Russian territory using drones and missiles, ostensibly in an effort to reduce domestic support for the war amongst Russians. On August 30, Ukraine attacked Moscow and five other Russian regions in the largest drone attack on Russian territory since the start of the conflict. Meanwhile, on the same day, Russia struck Kyiv with drones and missiles in the heaviest attack since spring, according to the head of the city’s Military Administration. On August 2, Russia attacked the Danube River port of Izmail using drones, reportedly damaging port infrastructure and almost 40,000 tons of grain; however, the head of Ukraine’s seaport authority reported that port infrastructure continued to operate and repair work had already started in the immediate aftermath of the attack. The Danube River has become the main export route since the expiration of the Black Sea Grain Initiative in early July.
In early August, the Ukrainian Ministry of Agrarian Policy and Food (MoAPF) made another significant upward revision to 2023 crop production estimates as the harvest season concludes. Total production of grains and oilseeds in Ukraine’s un-occupied territory is now estimated at 76.7 million tons (including 56.4 million tons of grains and 20.3 million tons of oilseeds), up from 68 million tons estimated at the beginning of the harvest season in June. The revised production estimate is around five percent higher than last year but still significantly lower than the bumper pre-invasion harvest of 2021, according to the MoAPF.¹ Nonetheless, Ukrainian farmers across the country continue to face significant challenges, including less liquidity available to invest in agricultural activities. However, the government continues to provide various forms of support. As of early August, 91 small and medium-sized agricultural enterprises had received financial grants since the beginning of the year, with a total 343 million UAH awarded. Additionally, as of mid-August, more than 7,600 Ukrainian agricultural enterprises had received low-interest loans since the beginning of the year, with the largest number of beneficiaries in Kirovohrad, Vinnytsia, Odesa, and Kyiv regions.
The Black Sea Grain Initiative was instrumental to moderating price increases in global wheat and grain markets in 2022. However, global markets have increasingly adapted to the effects of the war in Ukraine, and the balance of global supply and demand has significantly shifted in 2023. Prior to the expiration of the Black Sea Grain Initiative, USDA projected that Ukraine would contribute only around 10 and 5 percent, respectively, of global exports of maize and wheat in the 2023/24 marketing year; since then, USDA’s projections have not changed significantly. Consequently, the impacts of the expiration of the Black Sea Grain Initiative on global wheat and grain markets are expected to be limited overall. The most significant impacts of the expiration of the deal on global markets will be greater price volatility and greater vulnerability to future shocks. For instance, if poor weather in major grain-producing countries reduces expectations for global supply, or if expectations for global demand increase more than currently projected, then global food prices could rise again in late 2023. Additionally, there is concern for impacts on acute food insecurity in countries that remain dependent on grain sourced from Ukraine, either in the form of commercial imports or in the form of in-kind food assistance sourced by WFP via the Grain from Ukraine initiative, such as Afghanistan, Ethiopia, Kenya, Somalia, Sudan, and Yemen.
In West Africa, the impacts of the expired Black Sea Grain Initiative on regional wheat prices may be somewhat greater given the region's structural reliance on internationally imported wheat, including a significant share from Ukraine and Russia. Total regional wheat imports had already declined by around 1 million tons in the 2022/23 marketing year (July 2022 to June 2023) compared to the 2021/22 marketing year, driven largely by declining imports from Russia and Ukraine that were only partially offset by increasing imports from the rest of the world. As such, with supplies already tight, the end of the Black Sea Grain Initiative may result in further reductions in wheat imports. The region is also comparatively vulnerable to any future global price increases due to its overall high reliance on imported wheat. However, it should be noted that wheat contributes only around 14 percent of total cereal consumption in the West Africa region and is largely only consumed in urban areas. As such, any further reductions in wheat importation levels and/or market price increases will have only minor impacts on the food security of poor households across the region.

Recommended citation: FEWS NET. Ukraine Key Message Update August 2023: Ukrainian crop production estimates revised upward as harvesting concludes, 2023.

While last year’s production was also affected by the conflict, resulting in notable declines from the five-year average and from 2021’s bumper production levels (when Ukraine produced a record 81 million MT of cereals), it should be noted that the MoAPF’s crop production estimates pertain to areas under Ukrainian control. And, while total Ukrainian crop production is below average due to the loss of territory, yield is generally expected to be favorable in most areas not directly affected by active conflict.

This Key Message Update provides a high-level analysis of current acute food insecurity conditions and any changes to FEWS NET's latest projection of acute food insecurity outcomes in the specified geography. Learn more here.