World grain prices fall: Ukraine’s export earnings are at risk
3 September 16:29
Ukraine risks losing up to $0.9-1 billion in export earnings due to lower global grain prices in the 2025-2026 marketing year. Such a forecast was made by the Ekonomichna Pravda publication, taking into account a possible simultaneous decline in harvests to 35-38 million tons of soil grain, [Komersant] reports.
The fall in grain prices is a serious challenge for Ukraine’s economy, which is largely dependent on agricultural exports. However, agricultural experts are confident that well-thought-out response measures will help soften the blow.
Why international grain prices are falling
According to the World Bank’s Commodity Markets Outlook, global commodity prices, including food, will decline by about 12% in 2025 and by another 5% in 2026. This will return the price level to the pre-docking period of 2015-2019.
And the US Department of Agriculture reports that the average price of a bushel of wheat (35.24 liters) is projected to drop from $5.50 in 2024 to $5.30 in 2025.
Harvest-2025 in Ukraine: general trends
In 2025, the level of grain yields in Ukraine decreased compared to the previous year, mainly due to the late start of the harvest and unfavorable weather conditions. Harvesting is slow, which leads to a decrease in grain production. Experts note that yields are down 19% year-on-year and 13% below the average for the last five years.
Experts are optimistic only about corn yields in 2025, expecting an increase in volumes compared to last year. However, falling yields of winter wheat and barley in the east and south of the country complicate the overall situation. Russia’s full-scale invasion of Ukraine is also contributing to the decline in yields, as the military actions have led to problems with water supply in some regions.
In addition, the financial and logistical problems of agricultural enterprises have become another reason for the drop in yields, as farmers are forced to cut costs, including fertilizers and plant protection products. The situation is exacerbated by the fact that crops are becoming more vulnerable to diseases and pests due to insufficient use of fertilizers.
In turn, the Institute of Agrarian Economics also predicts an increase in corn yields, but a decline in other crops will lead to an overall drop in yields in the country. Northwestern Ukraine remains the best region in terms of climate change adaptation and the use of modern technologies in agriculture.
The media also notes that Ukrainian farmers have faced the problem of high fertilizer prices, which has led to savings in arid regions and worsened yields. Soil depletion is increasingly occurring due to sunflower harvesting, which leaves few nutrients for subsequent crops. Poor nutrition and the use of cheap fertilizers reduce yields.
At the same time, Ukraine has experienced a decline in export earnings due to lower grain volumes, although financial losses were insignificant due to rising global grain prices.
Read also: Wheat harvest disrupted: what is behind the worst start of the export season in years
How global grain prices will affect Ukrainian agricultural business
The situation on the global grain market may affect the domestic agribusiness in the following ways:
Reduce the margins of agricultural producers. Lower revenues from grain exports reduce access to investments in production, modernization or logistics.
To make diversification crucial. The need to develop processing of raw materials and search for new markets (North Africa and Asia) instead of dependence on the EU.
Increase fiscal tension (especially in regions where the agricultural sector is the main source of income).
What should the government and business do?
Economic experts see a way out of the current situation in the following:
- strengthening domestic processing of agricultural products instead of exporting raw materials;
- search for new markets beyond traditional exports to the EU and Asia;
- optimizing logistics and cutting costs to compensate for losses from falling prices.
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