29 January 2023
Astarta has been gradually selling its Y2022 crop, sugar sales were redirected from domestic market to export.
According to the company's report, in the last quarter of 2022, the volume of sugar sales decreased by 28% compared to the same period last year and amounted to 62,000 tons. It should be noted that compared to the previous quarters of 2022, the volume of sales was relatively stable:
Taking into account the significant increase in Ukrainian sugar exports in the fourth quarter of 2022 (138,000 tons compared to only 42,000 tons in the previous nine months), according to our estimates, exports occupy a fairly high share in Astarta's sales structure.
This is indirectly confirmed by the increase in the average selling price of sugar - if in the previous quarter it was about UAH 23,000 per ton, in the reporting quarter it was already UAH 25,600 (despite the fact that, according to Ukrstat data, domestic sugar prices in Ukraine decreased in the fourth quarter ). So we can expect quite good financial results of Astarta in this segment.
We will remind that in 2022, Astarta increased sugar production compared to last year - from 266,000 tons (excluding processed imported raw sugar) to 282,000 tons.
The total volume of sugar sales in 2022 was 225,000 tons.
Regarding the volume of sales of grain and oil crops, first of all, we note that in the reporting quarter Astarta sold a significant part of the wheat crop of 2022 (last year almost the entire wheat crop was sold in the third quarter, in 2022 - due to the blockade of Ukrainian ports, sales had to be postpone). This is very important from the point of view of the overall liquidity of the company.
We estimate the company's total wheat harvest in 2022 to be 260,000 tons, and 187,000 tons were sold in 3-4 quarters.
In the reporting quarter, sunflower sales almost corresponded to last year (23,000 tons were sold with a harvest of 92,000 tons), but corn sales were significantly less - 82,000 tons compared to 331,000 tons in the fourth quarter of 2021.
In its report, Astarta notes that as of the date of the report, corn has been harvested from 90% of the planned areas, the average yield is 9 t/ha. This means that the total harvest of Astarta corn can be roughly estimated at 330-340 thousand tons.
We should also note quite good average sales prices in the reporting period for both corn (approximately $262/t) and wheat ($257/t). At such selling prices (and also taking into account the high yield of corn), we expect quite good financial results for Astarta in the Grains Growing segment as well.
The company manages to maintain fairly active processing of soybeans and sales of soybean oil and meal (sales of oil increased by 75% compared to the corresponding quarter of the previous year and amounted to 10.7 thousand tons, but sales of meal decreased by 9% to 37 thousand tons).
Finally, we note that Astarta is increasing the production and sales of milk. In the reporting quarter, milk sales amounted to 26.5 thousand tons (approximately +10% compared to both the previous quarter and the corresponding period last year).
Our analysis of Astarta's financial report for the 3rd quarter of 2022 can be found at the link, the company's annual report is expected in March-April.