March 5, 2014 / 6:40 PM / 3 years ago

UPDATE 1-Traders shun new Ukraine grain deals on uncertainty-minister

(Adds comments from US Grains Council)
    KIEV, March 5 (Reuters) - Foreign trading houses have
shunned new grain export contracts due to continued tensions
between Ukraine and Russia, Ukraine's Agriculture Minister Ihor
Shvaika said on Wednesday.
    "They are still waiting and there are no new contracts,"
Shvaika told Reuters.
    In the wider dispute Wednesday, Russia rebuffed Western
demands to withdraw forces in Ukraine's Crimea region to their
bases amid a day of high-stakes diplomacy in Paris aimed at
easing tensions over Ukraine and averting any war.
    Political instability and violence had caused some traders
in Ukraine, the world's third-biggest maize exporter, to hold
back from agreeing new contracts, while Russian maize export
prices have been rising for two weeks. 
    Grain shipments from Ukraine are "becoming increasingly
difficult," although ports are open and vessels are loading, the
U.S. Grains Council said in a statement. Farmers are holding
grain, rather than selling it to exporters, to hedge against
devaluations in Ukraine's currency, according to the group.
    The U.S. Department of Agriculture last month projected
Ukraine will export 18.5 million tons of corn in the 2013/14
marketing year, which ends on Aug. 31. About 15 million tons has
already been shipped, leaving 3.5 million tons in projected
exports between March and June, said Cary Sifferath, a regional
director for the U.S. Grains Council.
    "Instability is creating opportunities for additional U.S.
exports to North Africa, the Middle East, and China," Sifferath
    Ukrainian grain lobby UAC said traders were continuing grain
exports from terminals in Crimea despite tensions.
    UAC said in a statement 45,000 tonnes of Ukrainian maize 
had been sent from terminals in Sevastopol to Italy and Spain in
the last two days.
    But the lobby warned it expected a decrease in shipments in
the near future.
    Ukraine, a leading grain seller, said this week it had
exported around 25 million tonnes of grain so far this season
and planned to ship an additional 8.7 million tonnes in the
remaining four months of this season which runs from July to

 (Reporting by Pavel Polityuk; Additional reporting by Tom
Polansek in Chicago; editing by Keiron Henderson and Sofina

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