Author: c001os

The Russian authorities unofficially prohibit farmers from selling grain to foreign customers at a price below the minimal threshold, though this strategy visibly hurts the industry. Russia blocked the delivery of 480,000 tons of wheat to Egypt in September since the sale price was below the minimal threshold of $270 per ton FOB (“Free on Board”) allowed by the government, Russian newspapers Kommersant and Forbes reported, citing their own sources. Russian publications assumed that by sticking to the minimal export price, Russia targets to use its dominant position in the global market to the advantage of the Russian farmers, who see their financial health worsening, and secure additional income to the federal budget. Russian publication Gorodn disclosed that the Russian strategy has already put pressure on the supply chain. In the southern regions, largely trade companies have already suspended purchasing grain from farmers, citing a lack of available warehouse capacity to store it. Andrey Sizov, director of SovEcon, a Moscow-based consultancy, admitted that the government policy slows down Russian grain exports, and the country could end up with record carryover stocks similar to what happened a year before. One source who wished to remain anonymous told Gorodn that wheat, similar to Russian wheat, is now sold on the global market for a maximum of $240 per ton FOB. “Agricultural Ministry believes that foreign buyers cannot live without Russian grain; they will buy at our price; we just need to wait. But there is a question for how long,” the source said, explaining that Algeria recently purchased the amount needed until the end of the year, Egypt will hold a couple more tenders and will stop purchasing until January. “So, wait until January? But in November, harvesting starts in Argentina, then in Australia, and everyone sells [grain] on the same market. So, it is not guaranteed that prices will rise to the desired level in January, especially given that the market is oversaturated with grain, including Ukrainian, the supply of which has again resumed through Odesa,” the source told Gorodn. A minimal export price is set also for the sunflower oil. As a result, some Russian oil factories suspended the start of work towards the end of September, while usually they open their doors around September 10. On the domestic market, farmers are trying to sell sunflower seed at the level only covering the production costs. Some farmers complain that the new measure puts heavy pressure on the industry, already troubled by export duties. As a result of the duties, the average profitability in the industry plummeted from 17% to 3%, estimated Alexander Yaroshenko, director of grain company Ural-Don. The minimal export price has proved to be another blow for farmers. “I believe that 4 more years of such restrictions and there will be no more grain export from Russia,” said Yaroshenko. “Perhaps we will not roll back to the state when we buy grain in Canada, like in Soviet times, but we will definitely lose an opportunity to export it,” he said.

Researchers at the Technical University of Munich have synthesised the amino acid L-alanine using enzymes, according to a report in the journal Chem Catalysis. Although the technology needs more work before it is ready for commercialisation, it could one day allow feed manufacturers to produce amino acids directly from carbon dioxide and renewable hydrogen and ammonia. Producers typically rely on fossil fuels or microorganisms to make amino acids, says Volker Sieber, a professor at the Technical University of Munich and one of the authors of the Chem Catalysis report. While single-cell protein synthesis is generally considered more sustainable than conventional amino acids derived from fossil fuels, it still requires glucose to feed the microbes. And the production of this glucose biomass still requires acres of land that could otherwise support greater biodiversity, Sieber said. If you really want to be sustainable in what you do … it’s more important to use renewable energy and carbon dioxide,” Sieber said, arguing that a windmill takes up less land than acres of crops. But if you try to synthesise single-cell proteins using carbon dioxide as a raw material, the process triggers intermediate chemicals that are toxic to the microorganisms themselves, Sieber said. To get around this barrier, the Technical University of Munich laboratory removed key enzymes responsible for amino acid synthesis from the microbes to replicate the cellular process outside a living organism. Using carbon dioxide, hydrogen and ammonia – all preferably from renewable resources, Sieber said – the lab was able to achieve a conversion efficiency of nearly 100%. They started with L-alanine because of its relative simplicity, he said, but have since synthesised other amino acids as well. Other processes – including microbial synthesis and the extraction of L-alanine from fossil fuels – are still cheaper than the enzymatic process developed in the lab, Sieber said. But the team at the Technical University of Munich is now working to refine the process and reduce costs. Sieber believes that if they can speed up the action of the enzymes, they will be able to achieve cost parity with other sources of amino acids.

EU production of compound feed for farmed animals in the 27 Member States is estimated at 148.9 million tonnes – a fall of 3.8% compared to 2021 figures, according to data published by the European Feed Manufacturers’ Association (FEFAC). Production fell for all feed sectors, but most significantly for pigs (-6.7%) and poultry (-3.2%) due to the spread of African Swine Fever (ASF) and Avian Influenza. Pig feed production fell by 3 million tonnes compared to 2021, with many Member States, including Denmark, Spain, France, Hungary, Portugal and Romania, recording a decrease of more than 5%. Smaller farms closed down due to the deteriorating economic situation and farm profitability. Pork exporting countries increased their production as China continued to recover from ASF and reduced its pork import volumes. ASF continued to play a role in Germany and Romania, affecting economic efficiency. Poultry feed production fell by 2 million tonnes, with several countries, including Bulgaria, France, Hungary, Italy and Portugal, severely affected by avian influenza. Some farms skipped cycles due to escalating costs, further impacting feed demand. FEFAC reported that cattle feed production fell by 0.5 million tonnes compared to the previous year. This was partly due to the amount of additional feed purchased in 2021 due to the severe drought. The Russian invasion of Ukraine and the resulting energy crisis in the EU had a significant impact on the EU economy and inflation, leading to reduced demand for animal products and therefore compound feed. Only 5 Member States, including Poland, Slovakia and Austria, managed to slightly increase or stabilise their feed production. Looking ahead, the European Commission’s forecasts suggest that compound feed production is expected to fall for all species except poultry this year. Uncertainty over feed and fertiliser prices and inflation will continue to affect the feed market. FEFAC market experts estimate that compound feed production will continue to decline by 1.5% to a level of 146.8 million tonnes.