Ukrainian farmers need five times more funds than the state provides
The Ukrainian government has introduced financing programs aimed at supporting the agricultural sector. But Ukrainian farmers need 5 times more than the total cost of these support programs.
Sergey Feofilov, General Director of UkrAgroConsult, spoke about this during the Agro&Food Security Forum, which was held in Warsaw.
Ukrainian farmers finance agricultural work from their income, which they receive from agricultural products. Farmers today dream of peace in Ukraine, but also of selling their grain reserves. Traditionally, agricultural products are sold in February – early March. Seeds, spare parts, fuel are purchased from the proceeds from the sale, but at the moment the situation looks completely different. Prices on the local market are so low that farmers are unable to cover, even recover, the funds for grown products.
According to Sergey Feofilov, wheat prices in early September are almost the same as a year ago, but logistics costs for transportation from elevators located inland to ports have doubled. The share of logistics funds in FOP prices also doubled, from 16% to 32%. The cost of delivering wheat to the western border today is $150/ton.
“The greatest risk is not only in the context of agricultural production next year, but also in 2024. Due to very low demand and problems in logistics, I would say that the situation in our market looks even paradoxical,” Sergey Feofilov believes.
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