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08KYIV980, UKRAINE LIFTS QUOTAS ON GRAIN EXPORTS – THIS TIME WE’RE NOT

May 27, 2008

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Reference ID Created Released Classification Origin
08KYIV980 2008-05-27 05:40 2011-08-30 01:44 UNCLASSIFIED Embassy Kyiv

VZCZCXRO3425
PP RUEHLN RUEHVK RUEHYG
DE RUEHKV #0980 1480540
ZNR UUUUU ZZH
P 270540Z MAY 08
FM AMEMBASSY KYIV
TO RUEHC/SECSTATE WASHDC PRIORITY 5654
INFO RUEHRC/USDA WASHDC
RUCPDOC/USDOC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCNCIS/CIS COLLECTIVE

UNCLAS KYIV 000980 
 
SIPDIS 
 
TREASURY FOR ALIKONIS 
DEPT PLS PASS USTR FOR CKLEIN/PBURKHEAD/EPORTER 
USDOC FOR 4231/ITA/OEENIS/NISD/CLUCYK 
USDA/FAS/OCRA FOR JFLEMINGS/DADAMS 
USDA/FAS/OGA FOR ROMEARA/JLAGOS 
USDA/FAS/PECAD FOR MLINDEMAN 
 
E.O. 12958: N/A 
TAGS: ETRD EAGR WTRO UP
SUBJECT: UKRAINE LIFTS QUOTAS ON GRAIN EXPORTS - THIS TIME WE'RE NOT 
KIDDING 
 
REFS: A) STATE 53353 
      B) KYIV 835 
      C) KYIV 807 
 
1. Finance Minister Viktor Pynzenyk announced to the press on May 21 
that the GOU had decided to lift export restrictions on grain. 
(Note: Prime Minister Yulia Tymoshenko had made a similar 
announcement in April (ref C), but the government then in fact only 
loosened the restrictions, rather than abolish them (ref B).  End 
Note.)  Cabinet of Ministers Resolution #470, released to the public 
on May 23, confirmed the elimination of restrictions on grain 
exports, effective immediately.  The move followed private comments 
from several government officials that a good harvest had obviated 
the need for export restrictions.  Export restrictions on sunflower 
oil remain in place, however. 
 
2. Comment: The cancellation of grain export quotas will have only a 
limited effect on domestic markets in the near term as traders will 
not be able to export grain in storage before the harvest. 
Logistics is likely to take over a month, with the first shipments 
of new crops likely to appear on the market in late June.  Extra 
grain on the local market will therefore continue to keep domestic 
prices depressed, which was the ultimate goal of the export 
restrictions.  Nonetheless, the GOU decision paves the way for 
increased grain exports to the global market at a time when supply 
is in desperate need, and it marks achievement of an important USG 
policy goal (ref A).  End Comment. 
 
TAYLOR

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