Grain traders ask Ukraine to suspend price mechanism changes, say exports at risk

KYIV (Reuters) - Ukraine's grain traders union UGA said on Monday it and the UAC agrarian producers union had demanded that the government suspend additions to the mechanism for determining minimum export prices, warning that the changes could halt exports.

In December, Ukraine introduced a new system for exporting key agrarian goods, including grains, which implies a ban on shipping consignments of goods at prices below those set by the agriculture ministry.

Earlier in March the government amended the rules, saying that the minimum export price for a particular good cannot be less than the minimum price for that type of good under the same delivery condition the previous month.

"Export prices naturally fluctuate depending on global trends, seasonality, logistics, demand and competition," UGA said in a statement.

"An artificial ban on price reductions ignores market realities and threatens Ukraine's ability to conclude export contracts," it noted.

The union said it asked the government to suspend the amendments and hold open consultations with business.

The UGA added that it had also emphasised the importance of clarifying and unifying the terminology, in particular, the definition of "minimum price", "reference price" and "supply bases".

Ukraine is a major grain and oilseed grower and exporter. The farm ministry said the country had exported 32.4 million metric tons of grain so far in the 2024/25 July-June season.

(Reporting by Pavel Polityuk; Editing by Andrew Heavens)