Agrarian potential of Ukraine during the war: analyses and forecasts

EOS Data Analytics has conducted in-depth analyses and provided forecasts for major crop yields for 2024-2025.

Forecasts and methodology

Using forecast meteorological data from the European Centre for Medium-Term Forecasts, EOSDA experts applied scenario analysis to estimate future crop yields. Three weather scenarios were considered:

• Precipitation less than the long-term average
• Rainfall at the same level as the average
• Precipitation above the multiyear average

The main focus is on precipitation, as this is a key factor for crop development in Ukraine.

Key forecasts for 2024

• Winter wheat and barley: gross harvest is expected to decrease by 1.7 million tonnes and 0.7 million tonnes , respectively, compared to 2023. This is due to projected rainfall deficits in some regions.

• Sunflower: gross harvest is projected to increase by 0.4 million tonnes. The high profitability of this crop makes it attractive to farmers, despite logistical challenges.

• Maize and soya: gross harvest is expected to remain at the level of 2023. The trend of increasing soybean acreage continues, with an increase of almost 50% compared to 2021. This is due to the high market value of soybean and its ability to enrich the soil with nitrogen, which reduces fertiliser costs.

Factors affecting the forecast

• Weather conditions: Uncertainty in weather forecasts affects the accuracy of estimates. The use of ensembles of simulations makes it possible to take into account different weather scenarios.

• Economic and logistical challenges: Rising logistics and fertiliser costs are forcing farmers to switch to more profitable crops.

• Military action: Instability in some regions affects sown areas and, consequently, the total gross yield.

Trends and prospects

• Shifting focus to profitable crops: Increases in soybean and sunflower plantings indicate farmers' desire to maximise profits in the face of economic and logistical constraints.

• Adaptation to climate change: The application of modern technology and agrarian practices will mitigate the impact of unfavourable weather conditions.

• The war disrupted crops on about 25 per cent of Ukraine's arable land.

• 500,000 hectares of land in the de-occupied territories need to be demined; Ukraine exports 70% of its agricultural products, and these exports ensure global food security; Despite available credit programmes, current circumstances do not allow agriculture to flourish.

• The amount of damage caused by Russia to Ukraine's land fund and agro-industrial complex is $4.3 billion.

• A complete shutdown of agriculture in Ukraine could result in the loss of 89% of sunflower oil production and 85% of corn production in the world.

• The 2023 summer crop yield forecast exceeds the 5-year average by more than 10%.

• USAID estimates that agricultural production for the 2023/24 marketing year will be 88.5% of 2022/23.

• In 2025, analysts expect food producers to generate higher profits to cover their costs.

Despite the projected challenges, Ukraine continues to be a key player in the global agricultural market. The flexibility and adaptability of the country's agricultural sector give grounds for optimism.

Expert opinion

Despite a significant reduction in the area under cultivation, higher logistics costs, and lower profitability of growing major crops, Ukraine remains one of the key players in the global agricultural market
ukraine remains one of the key producers and importers of agricultural products in the world
products in the world. Thus, by the end of 2023, Ukraine ranks 8th among the main importers of wheat, 7th - barley, 9th - corn, 2nd - sunflower and 9th - soya. - Oleksiy Kryvobok, Scientific Solutions Expert at EOS Data Analytics

Note: Forecasts will be regularly updated as new data becomes available, which will allow for a more accurate assessment of the situation and necessary measures to be taken.