Every year, Ukraine increases production and processing volumes of grains and oilseeds, and, as a result, the country rises export volumes of the products. Besides, the country has rather favorable geographical position. As a result, importers continued growing own interest in Ukrainian agrarian market.
In the current season, the large-scale Estonian company Grain Marketing deserved attention among other new players of Ukrainian grain and oilseed markets. Ivar Rebase, the director of Grain Marketing, agreed to inform about activities of the company and the plans for the future to the journalist of APK-Inform.
- Ivar, would You tell us about activity directions of Your company?
- The company was founded in 1998. In Estonia, the main activity direction of Grain Marketing concentrates on selling of maize, and also soybean, sunflower and rapeseed meals and cakes.
The company has long-term work experience of purchasing of rapeseed, grains and maize from Kazakhstan, the Russian Federation and Ukraine, with the further selling on the markets of Europe and the Baltic countries, where we have rather good partner relations with direct consumers of the products.
- Does Your company have representative offices in other countries?
- Yes, we have such representative offices. In 2006, we founded "Grain Marketing-Kazakhstan" Ltd. in Kazakhstan. The company deals with rapeseed purchases and exports. In 2008, Kazakhstan banned export trading with the oilseed. Nevertheless, in the current year, we plan to continue working on the market of the country, and to date, we provide the active negotiations with several large-scale Kazakh agricultural producers.
In Ukraine, we organized partner cooperation with the company "Кiеvаgrоprоduct". Generally speaking, we start working in the country in the current year. Previously, we tried to enter the market, but all attempts turned out to be unsuccessful.
- How did Your company pass though the season-2008/09? How did the world financial crisis affect the activity of Grain Marketing?
- 2008/09 МY turned out to be worse compared to the previous year due to several reasons. First of all, the oilseed marker permanently faced the falling terms. Secondly, due to the financial crisis, several our buyers (rather large industrial complexes of the Baltic countries and the EU) lowered own paying capacity rates, which also provided negative influence on the cargo flows of our company.
- Your company provides purchases of commodities from Ukraine, Russia and Kazakhstan. What are the main peculiarities of working with the countries?
- Ukraine has high-powered ports, but has low-quality market mechanism of commodity purchasing as opposed to European countries. That is why, both producer and processing and export companies have difficulties operating in such conditions. The market is completely unpredictable, purchasing operations are chaotic, the market has no coherent process of price formation, which greatly rises risks in the sphere. As a result, it is rather difficult to receive the solid confidence in the possibility of purchasing of any goods item. For example, to date, we purchase 5 thsd tonnes of rapeseed at the specified price on paper, but then the price dramatically changes, and nobody deliveries the cargo lot to us. As a result, we have to purchase all deficient volumes of the product at any price levels in order to fulfill all obligations of the export contract. Of course, we will receive less profitable price in such case.
Kazakhstan also has own features in trading. For example, Kazakh grains face various problems in price competition in many European ports with other countries-producers, first, due to difficult and expensive logistics. At the same time, the situation in the market segment of rapeseed is better: in the majority of cases, the prices form based on the European exchange market, and traders mainly fulfill all contracts.
The country has rather small number of rapeseed producers, and production volumes of the oilseed are lower compared to Ukraine, the quality of Kazakh rapeseed always was very high. At the same time, to date Kazakhstan has no laboratories, which can determine rapeseed qualitative characteristics according to European standards.
Every year, rapeseed export market of Russia shows alternate tendencies. In the current year, the situation will probably provide to presence of rapeseed exports from the Russian Federation. At the same time, Russia has acting import duties for rapeseed at the rate of 15%. And the import duty almost stops all export trading with the oilseed. Or provides the possibility of trading with rather limited volumes of rapeseed.
In addition, Russia has own peculiarities of railway transport shipment. All rail cars’ park (grain carriers) is actually monopolized through foundation of large-scale new structure, which still does not work rather clear and understandable. Moreover, at the same time, we did not face such problems in Ukraine and Kazakhstan at all.
- What of the mentioned countries does provide the main share of our purchasing operations?
- Till the present time, we provided the main share of purchasing operations of rapeseed in Kazakhstan. In the current year, we plan to realize essential purchases of the oilseed in Ukraine too.
Also we provide the main share of oilseed meals (cakes) purchases (nearly 90%) from Ukraine.
In Russia, we purchase both rapeseed and oilseed meals (cakes), however in the country we operate with smaller volumes.
- What are the main markets of Your company?
The following countries are the main sale markets - Denmark, Germany, the Baltic countries.
- Do You plan to widen Your geography of sales? If yes, then what countries do You plan to cooperate with ?
- Due to our partner, the company Zeleny Informacion y Mercado (Spain), we started entering Spanish market. We also plan to start operating on the market of the United Kingdom in the nearest future.
- How do You estimate prospects of the season-2009/10?
- In a word - the season will be rather difficult. It will be important to survive during the season, keep the current positions and the company in at large.
- In the current year, the company Grain Marketing becomes the sponsor of eighth international conference "Fat-and-oil industry-2009". Would You tell us the main aim of the participation in the event?
- Of course, the main target of our participation in the conference is the foundation of new business contacts with companies from Ukraine, Russia and other countries.
Interviewed Anna Tsykal
As a reminder, the eighth international conference "Fat-and-oil industry-2009" takes place in Truskavets (Ukraine, health resort complex "Rixos-Prykarpattya") on November 25-27.
You can become acquainted with more detailed information about the program and conditions of participation, and fill in the application form at the web site www.apk-inform.com.
