Ukraine, which plans to harvest up to 37 million tonnes of grain in 2005, needs to double the volume of grain bought by state funds to six million tonnes in 2005/06, Farm Minister Oleksander Baranivsky said on Monday. Earlier this month Baranivsky said Ukraine had to buy about three million tonnes of grain from the 2005 crop, but now he says a higher volume is needed to prevent a possible fall in local feed prices and support domestic fodder producers.
He said regional administrations, the state reserve and the state-run Khlib Ukrainy company would buy food grain while Khlib Ukrainy would purchase feed.
But Baranivsky did not specify where the state company would get funds to finance such large purchases.
In 2004 Ukraine bought about three million tonnes of food grain via state funds.
Traditionally grain prices fall sharply in July-September due to the arrival of the new crop on the market.
Earlier this month the government set minimum purchase prices for key agriculture commodities.
In line with the government resolution, the minimum price for milling wheat was set at $136.5 per tonne ex-farm. Feed wheat was set at $96.9, feed barley at $77.2 and maize at $89 per tonne.
The minimum prices come into force from July 1 for wheat, barley and rye and from September 1 for maize, sunseed and white sugar.
The government has said Ukraine is likely to harvest 35-37 million tonnes of grain in 2005 compared with a record 41.8 million in 2004.