The National Bank of Ukraine confirmed losses of part of the crop due to spring frosts, but do not expect a significant impact on food inflation. This was reported by Interfax.

“We had partial damage to winter wheat, winter rapeseed, corn, fruit crops. It can be said with a high degree of probability that there are losses of part of the early varieties of fruit and berry crops,” Deputy Head of the NBU Serhiy Nikolaychuk said during a monetary policy briefing.

According to him, farmers continue to adapt to climate change, in particular by planting different varieties of crops. Therefore, the overall consequences for inflation are considered moderate.

Nikolaychuk suggested that prices for stone fruits may be higher than expected. However, the situation with winter crops looks more stable so far due to abundant rainfall in recent weeks. At the same time, risks remain relevant for spring crops.

Another factor affecting the agricultural situation is the shortage of labor. According to Nikolaychuk, due to a lack of workers and weather conditions, the harvesting of some crops is being delayed.

The National Bank does not yet have updated assessments of the agricultural sector. Work is currently underway on a new forecast, which will be presented later.

The previous NBU forecast for grain harvest in 2024 was 61.7 million tons. However, Agriculture Minister Vitaliy Koval recently informed Reuters that the harvest in 2025 may decrease to 51 million tons – 10% less than this year.

Despite weather challenges, the National Bank believes that even in the event of a repeat of a negative scenario like last year, it will be possible to contain the rise in food prices.

“Containing food inflation will be easier, as the import will become a significant factor,” explained Nikolaychuk.

He also noted that prices for products in Ukraine have almost reached the level of neighboring countries and in some positions even exceeded it. Therefore, the NBU hopes to avoid a repeat of last year’s spike in food inflation.

NBU Governor Andriy Pyshny confirmed that the forecast for reducing inflation to below 10% this year remains valid.

It was previously reported that the National Bank revised the inflation forecast for 2025 and raised it from 8.4% to 8.7%. It is expected that in 2026 inflation will return to the target level of 5%.

Source - https://agronews.ua