It would have been impossible to imagine a worse moment for introducing a 10% duty on soybean exports from Ukraine — ASAP Agri
The soybean export season in Ukraine began with disruptions and falling prices. The introduction of a 10% duty without a clear exemption mechanism put exporters in a dead end — contracts were canceled, buyer confidence faltered, and domestic market prices fell. Only after the government mechanism was approved did the situation begin to gradually stabilize, but with bureaucratic obstacles, Viktoria Blazhko, head of editorial content and analytics at ASAP Agri, told Latifundist.com.
"It would have been impossible to choose a worse moment to introduce a 10% duty on soybean exports from Ukraine. At the end of the season, when supply declined, soybean prices skyrocketed — and that was when expensive contracts were signed. Importers from Turkey, Egypt, and Italy were waiting for these cheap September shipments. So the 10% duty was effectively a “brazen” refusal for them — a failure to fulfill or a postponement of contracts on the part of Ukrainian exporters. This has once again damaged confidence in Ukraine as a supplier," — comments ASAP Agri CEO Khristina Serebryakova.
In September, soybean shipments fell to 77,000 tons, compared to more than 240,000 tons a year earlier.
On October 3, the government approved a mechanism for exemption from duties, but the market faced a new bureaucratic trap. To obtain a conclusion, it is necessary to specify the volume of the consignment and submit transport documents, which can only be drawn up after the ship has been loaded. However, it is impossible to load the ship without opening a PMD, and a PMD cannot be opened without reserving 10% of the duty. As a result, exporters' money is effectively “frozen” for up to 30 days.
According to Blazhko, despite this, the very fact of the mechanism's adoption changed the mood: the supply of soybeans increased, and prices fell. On a CPT port basis, purchase prices fell from $405 to $390/t, and on the destination markets:
- CIF Marmara — from $437 to $428/t,
- CIF East Med — from $441 to $432/t.
Prices have returned to mid-July levels, although a further decline of $5–7/t is expected on external markets.
At the end of September, ASAP Agri lowered its forecast for soybean production in Ukraine to 5.8 million tons (compared to 6.2 million tons a month earlier), which is 1.4 million tons less than last year. However, the global market is hardly affected by this — the US and Brazil are forming a global surplus.
The EU may reduce imports of Ukrainian soybeans to 800–850 thousand tons, which is half as much as last year. The main reasons are a smaller harvest and the impact of tariffs. Additional pressure is created by the internal situation in the EU: demand for soybeans is declining as processing beans has become less profitable compared to rapeseed. Less processing means less imports, primarily to the Netherlands, Germany, and Italy, which were among the main buyers of Ukrainian soybeans last year.
“In addition, Argentine soybean meal is currently very attractive on the market, and European buyers often use this fact to put pressure on the prices of Ukrainian meal — sunflower, rapeseed, and soybean,” adds Khristina Serebryakova.