The Ukrainian Grain Association (UGA) welcomes the signing of a memorandum on the ceiling volume of sunflower oil exports from Ukraine in the 2020/2021 marketing year (MY, September-August) at the level of 5.38 million tonnes, although it considers this market regulation tool to be not the best one, but much better than the introduction of direct restrictions - licensing or quotas, the organization of grain traders said.
The UGA recalled in a press release that the ten-year experience of signing a similar document in the grain market shows the effectiveness of this tool, which allows market participants to work calmly and know that no one will interfere in their work. Also, this tool allows international partners to form their export expectations and forecasts, and Ukraine - to maintain its reputation as a reliable trading partner in the world market.
The UGA clarified that the memorandum is not a law, a government resolution, a tough administrative decision, or a contract with mandatory requirements. It is, in fact, a trust-based "gentleman's" agreement between the government and market participants.
According to the association, this instrument will allow the sunflower oil market to function effectively, since it previously demonstrated its effectiveness in the grain market.
The organization of grain traders clarified that in the current season (September-March) Ukraine has already exported about 3.1 million tonnes of sunflower oil. At the same time, in 2020, grain was exported for a total of $ 9.4 billion.
According to the association, the UGA is an association of producers, processors and large exporters of grain, annually exporting about 90% of Ukrainian grain products. The main goal of its activity is to promote the formation and development of the Ukrainian grain market and create the necessary conditions for the development of business structures of the grain market in Ukraine.