Development of Ukraine’s agribusiness strategies. Investment climate. Factorial analysis

The vast majority of market participants predict grain and oilseed production to increase in the medium and long term. As a rule, these scenarios are based on linear forecasting methods. However, new factors should be taken into account that call into question the realism of the linear scenarios.

The research results provide UkrAgroConsult experts with grounds for a different interpretation of the Ukrainian market behavior in 2017-2022. When developing their strategies, grain and oilseed market participants need to take into account that farmer revenues and profits will remain the main source of finance for agricultural production in 2017 – 2022. The role of the banking sector will be insignificant.

Macroeconomic stabilization, with grain and oilseed prices being very likely to remain low, will lead to a decline in crop production margins and farmer revenues/profits. This factor will significantly reduce the financing of agricultural production from own reserves with the absence (or a minor role) of alternative funding sources.

In the study “2017-2022: Development of Ukraine’s Agribusiness Strategies. Investment Climate. Factorial Analysis,” UkrAgroConsult experts show that this factor increases the probability of slowing inertial development of Ukraine’s agricultural sector in 2017-2022. In this case, stabilization of grain production or a drop in yields and exports is possible in the medium term.

Analytical study

In the basic version of the study, information covers a 3-5-year period according to the contents given on the website. However, if required, the study structure can be adjusted in line with the customer’s wishes.

CONTENTS:

Studying and forecasting methodology

Key trends of the global market. Open economy of Ukraine

Paradox of the 21st century: An era of cheap raw materials against stagnation of the world economy

Growing role of geopolitical factors

Regionalization as the main trend of the global economic development

Ukraine: Intensification of the agricultural sector as a response to new challenges  

State agricultural policy

Investment climate forecast for Ukraine’s agricultural sector. Margin/profit of companies as the main source of financing agricultural production. SWOT analysis

Agricultural sector: From labor-intensive production to capital-intensive one

Forecast for Ukraine’s investment climate

Analysis of consequences of the national currency’s devaluation

Analysis of price behavior resulting from natural disasters in any grain growing country

Impact of the global commodity market’s price cycle (price growth) on revenues of Ukraine’s agricultural companies

New pricing tools in commodity markets

Opening the land market. Forecast for post-trends

Opening the land market: Forecast for agri company structure

Agricultural sector condition features the following trends as of 2018

Scenarios of land market opening

Development trends in the agri company structure, 2017-2022

New reality: Strategies of key groups of agricultural market participants

Analysis of agriholding strategies

Analysis of current strategies of Ukraine’s banking sector

Analysis of the behavior of farming entities

Analysis of strategies of input suppliers

Ukraine: Key tools for increasing profitability of agricultural companies

Short-term, medium-term and long-term crop forecasts  

Conclusion

 

In view of high capital intensity of agricultural production and consequently aggravating struggle for markets and demand, the investment focus shifts from grain producing countries to grain buying ones in order to set up own local infrastructure there for promoting own commodities and generating demand for them.

The majority of the world’s economies have not yet overcome the consequences of the 2007-2008 financial crisis. The current strategies of Ukraine’s development do not adequately reflect the economy’s place and role in the context of its new openness level and, as a result, fail to adequately reflect its global competitiveness. Two strategy options dominate now. The first one consists in making partial, band-aid decisions able to improve and/or stabilize the situation in the short run. The latter of the two strategy options envisages developing and adopting new goals, incentives and equilibrating mechanisms in the course of economic/consumption growth, i.e. search for a new paradigm of the agricultural company’s development.

In the medium term (3-5 years), the strategies should avoid situations when investments are sourced from devaluation, not from profit and effective conduct of business. Unfortunately, there is no understanding that Ukraine’s open economy sharply enhances the role of performance and real profit indicators calculated according to international methodology and parameters.

This is a standard study. UkrAgroConsult is ready to prepare a custom study at your personal request.

Any study can be extended with more criteria. In addition, there is an option to buy only the statistic part (Database) in Excel format with no analytics or forecasts.

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