Ukraine has great prospects for increasing the number of pigs up to the levels of 1991, after which they decreased four times.
Mykola Babenko, head of the Meat Industry Association and the Center for Livestock Efficiency, announced this data at a press conference at Interfax-Ukraine on Monday.
“The situation (in the pig industry – IF-U) changed dramatically in 2022 in the world, as well as with grain exports in Ukraine. In fact, Ukraine has lost added value on exported grain. At the same time, value-added industries that can export large volumes with 10 times less logistics requirements remain at the development stage. We are talking primarily about the meat industry,” he said.
According to the head of the industry association, Ukraine currently produces about 600 thousand tons of pork and meets domestic consumption. It is noteworthy that until 2022, the domestic market was not supplied by domestic producers, so Ukraine had to import 10-30% of pork annually to meet consumption.
In 2022, global pork prices doubled, making it economically unfeasible to import pork into the country. At the same time, meat consumption in the country declined. The blocking of grain exports and the loss of economic profitability of grain production, the reorientation of farmers to the production and export of pork are becoming evident, Babenko explained.
He drew attention to the fact that global pork consumption is growing annually by 2 million tons and by 2030, according to the OECD (Organization for Economic Cooperation), its consumption will grow by 16.5 million tons. Ukraine, which produces 600 thousand tons, can and should pay attention to this segment, which is growing dynamically in terms of quantity and value.
Ihor Liakhovsky, Head of the Export Group of the Meat Industry Association and founder of Agro-Invest LLC, reminded that with the outbreak of hostilities in Ukraine, a significant number of consumers who had been driving demand for pork had left. However, farmers were able to increase pig production to pre-war levels.
“Imports of meat products to Ukraine are declining. This is the first bell that indicates the filling of the domestic market. (…) Every week on Friday, representatives of the processing industry and farmers meet to discuss prices and purchasing volumes. (…) We have an outflow of population, and therefore fewer consumers. The main consumer of the domestic market is the Ministry of Defense, which buys 30-35% of the pork produced by industrial producers. If it has made its purchase, it does not enter the market for the next few weeks, and prices fall. Even with a shortage of raw materials, the cost of purchases from processors during this period is reduced,” said the processor.
He is confident that the only way out of the situation to maintain positive dynamics and maintain profitability is to enter foreign markets where Ukrainian quality products can find their place without much effort.
Mr. Lyakhovsky is also convinced that most processing companies are ready to export. According to him, processing companies are not standing still. He emphasized the importance of government support for Ukrainian processors to export and pointed out that the lack of attention to the industry in the current situation threatens to quickly turn the domestic market into a surplus one. After that, farmers’ interest in pig production is likely to decline, and state support and lending to the industry, as well as existing investment programs, will be devalued.
“As of May 1, there are 5.1 million pigs in all categories of farms in Ukraine. Of these, 66.5% are directly accounted for by organized production in industrial enterprises. The number of pigs in the population is constantly decreasing. However, over the past year, there has been a good increase in business enterprises, which has changed the situation in the domestic market,” said Ihor Vyshtak, Director of the Agrarian Development Department of the Ministry of Agrarian Policy and Food.
According to him, in 2023, sales of meat of all types of farm animals amounted to more than 3 million tons, which is 1.3% more than a year earlier. Poultry accounted for 56% of this total, pork for 28%, and beef for only 14%. Vyshtak confirmed that the Ministry of Agrarian Policy understands the prospects of pig production, where it is possible to increase the number of animals in a short time. The ministry also notes a decrease in imports and an increase in domestic production in the domestic market.
Taras Mykolayenko, Executive Director of Ukrbioethanol, who attended the press conference, emphasized the importance of livestock development, which is a related business that affects the development of bioethanol. As an example, he cited the experience of China, which has implemented a program to use 5 percent bioethanol in transport not because of the environment, but for the sake of pig production.
“Before the war, China used to buy 8-12 million tons of corn to produce bioethanol and, consequently, cheap protein. It is used to increase meat production (…) China has borrowed this experience from the Americans and Europeans and is already ranked third in the world in bioethanol production,” he said.
Speaking about America’s experience, Mykolayenko reminded that in this country, 40% of all corn, or 120 million tons, is processed into bioethanol, which is four times more than the total amount of this crop grown in Ukraine. It is bioethanol that has become a companion product that has turned the United States into a world leader in poultry exports.
“Ukraine can get 6 billion euros of added value from the development of dry-fed pig production, and with cheap proteins – bioethanol waste, it can be 12 billion euros, we need to provide Ukraine with cheap proteins. If this is not done, we will always lose competition to the Americans or Europeans who have implemented bioethanol programs,” stated the head of Ukrbioethanol.
He noted that in times of war, it is imperative to develop energy independence, and increasing domestic production of bioethanol will allow Ukraine to reduce imports of petroleum products, which are purchased for more than $400 thousand every hour.
Mr. Mykolayenko also reminded of the importance of adopting the draft law No. 3356-d in the second reading, which will be fundamental for the bioethanol industry.
Oleksandr Melnychenko, Acting Executive Director of UkraineInvest, in turn, emphasized that Ukraine has developed and implemented a system of investment policies and practices in the face of war.
“Ukraine has created modern pro-European investment legislation. Two months ago, the formation of this legislation was completed, and it became fully operational. This legislation includes, in particular, such a concept as attracting significant investments. The Law on State Support for Investors with Significant Investments stipulates that an investor whose investment amounts to EUR 12 million plus ten jobs receives a whole list of preferences from the state,” Melnichenko said.
He mentioned the following preferences: exemption of the investor from VAT, land fees, customs duties, support in obtaining a land plot and others, which allow the investor to receive 30% reimbursement of investment costs, in particular, in the form of reimbursement of costs for transport infrastructure engineering, and a number of other preferences after concluding a special investment agreement.
Melnychenko was reminded that UkraineInvest is already working on and studying a number of investment projects that will be presented to the Ministry of Economy. Particular attention is paid to the processing industry. And not only foreign investors but also national producers can take advantage of this law.
Ihor Vyshtak, Director of the Agrarian Development Department of the Ministry of Agrarian Policy, emphasized that Ukraine has begun the process of screening legislation for its compliance with the European one. By the end of the year, the government expects comments and recommendations on it. After that, export prospects will open up for the pig industry. The government believes that Ukrainian producers will be able to get their products to Africa and North Asia and hopefully to the European Union as well.
The Meat Industry Association invited all those interested in the development of the industry to join the Grain. Pigs. Meat” Forum to be held on June 12 in Kyiv.
Zaporozhkoks, one of Ukraine’s largest coke and chemical producers and part of Metinvest Group, increased its blast furnace coke output by 1.9% year-on-year to 362.7 thousand tons from 355.7 thousand tons in January-May this year.
According to the company, it produced 75.7 thousand tons of coke in May.
As reported, Zaporozhkoks increased its blast furnace coke output by 16% in 2023 compared to 2022, up to 856.8 thousand tons from 737.4 thousand tons.
“Zaporozhkoks produces about 10% of coke in Ukraine and has a full technological cycle of coke products processing. It also produces coke oven gas and pitch coke.
“Metinvest is a vertically integrated mining group of companies. Its major shareholders are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage the company.
Metinvest Holding LLC is the management company of Metinvest Group.
In January-May of this year, Zaporizhstal Iron and Steel Works increased its rolled steel output by 47.4% year-on-year to 1 million 48.8 thousand tons from 711.6 thousand tons.
According to the company, steel production during this period increased by 45.4% to 1 million 249.5 thousand tons, and pig iron production by 36.3% to 1 million 290.4 thousand tons.
In May, Zaporizhstal produced 240 thousand tons of pig iron and 240.2 thousand tons of steel, and shipped 204 thousand tons of rolled products.
As reported earlier, in 2023, Zaporizhstal increased its rolled steel output by 57.2% compared to 2022, to 2 million 54.7 thousand tons, steel by 65.4%, to 2 million 466.9 thousand tons, and pig iron by 35.3%, to 2 million 718.9 thousand tons.
“Zaporizhstal is one of the largest industrial enterprises in Ukraine, whose products are in great demand among consumers both in the domestic market and in many countries of the world.
“Zaporizhstal is in the process of integration into Metinvest Group, whose major shareholders are System Capital Management (71.24%) and Smart Holding Group (23.76%).
Metinvest Holding LLC is the management company of Metinvest Group.
International rating agency S&P Global Ratings has affirmed Uzbekistan’s long-term sovereign credit rating at “BB-” with “stable” outlook, the agency said in a statement.
The short-term credit rating was affirmed at “B”.
According to the agency, at the next stage of reforms implemented in Uzbekistan, the new tariff policy aimed at ensuring energy security and efficiency, and the reduction of budget subsidies deserve special attention.
S&P notes that the “Uzbekistan – 2030” strategy attracts investments in transport, telecommunications, agriculture, tourism and other sectors, reforms the energy sector, privatization and improvement of fiscal policy.
Thanks to investments in electricity and gas production, green energy and mining, as well as reforms aimed at creating a market economy, S&P forecasts Uzbekistan’s GDP growth to average above 5% per year in 2024-2027.
According to S&P estimates, gradual reduction of the budget deficit will be achieved starting from 2024 by increasing the targeting of subsidies and social spending and abolishing some tax exemptions.
The report also notes that the law “On State Debt” sets the upper limit of state debt and there are annual limits on newly attracted foreign debt.
According to the agency’s report, Uzbekistan’s sovereign credit rating may be upgraded and the outlook may be improved if reforms lead to higher-than-expected economic growth in the medium term and have a positive impact on the sector’s fiscal and external indicators.
Factors downgrading the country’s credit rating are the rapid growth of the country’s total external debt, increased fiscal and balance of payments risks due to failure to achieve the expected results of projects financed by external loans.
President of Ukraine Volodymyr Zelenskyy has stated the need to accelerate the delivery of military assistance to Ukraine as part of the $61 billion support package approved by the US Congress in April this year.
“It is very important that this (the decision of the Congress to help Ukraine – IF-U) was adopted. It is a weapon for us, it is an important signal for Russia. And it is important that it was a united positive decision within the United States. But I believe that not much of this amount has come today. This is my personal opinion. But I can’t staff the brigades, the reserves, just to change the brigades that are standing, so that there is a normal rotation,” Zelensky said in an interview with The Guardian published on Saturday.
Thus, he said, “Russia clearly understands this – what they are doing with Kharkiv and why they are going north and looking in that direction – to stretch the front.”
“They know that we have an understaffed reserve, they know that we cannot send a reserve without the appropriate weapons – the way they send theirs like meat. They understand that our troops in the east, and the Russian Federation does not abandon its main goal of occupying the entire east of our country, need to stretch our forces. They are stretching our front and understand that if enough (weapons – IF-U) came, we would staff the brigades, we would not withdraw our forces from Donbas and could respond with our long-range (to shelling – IF-U) of Kharkiv region,” the president said.
At the same time, Zelensky emphasized, no one is blaming anyone. “We are where we are. We are at war. And not at the beginning of it. And so we need to look for a way out of the situation every day.”
He also noted that, in general, the amount allocated by Congress is large enough to equip Ukrainian brigades easily and quickly, but, in his opinion, it is coming slowly.
“And everyone is happy, everyone is happy that they managed (to agree on the aid to Ukraine – IF-U), that everyone put pressure on the US together, bipartisan support, 61 billion – and it is just beginning to be transferred to us, coming to us. But Russia is faster. Russia is slower than Ukraine, but faster than the West. And this is a problem. And if every minute can take away people’s lives, then we want faster deliveries (from the US – IF-U). It’s just that the price of this is more painful for us than for our partner countries. Because no one in their families died. And thank God! But you don’t know what war is until it comes to your home,” Zelensky emphasized.
He also emphasized that “this speed is constantly lacking in the West, in our partners,” adding that this could be due to various reasons, including bureaucratic ones or “a different approach to life in non-war time.”
“In war, you have other priorities: survival, people, children – this is the main thing. And when you’re safe, you get used to it, and that’s why your time goes differently. You don’t need to survive now, because the next second you might be killed. For example, you are in Kharkiv, and if you don’t go down to the bomb shelter – and their (Russian – IF-U) weapons are 60 km, 100 km away – and you don’t go down, you could be dead,” Zelensky summarized.
At a meeting on Friday, the Cabinet of Ministers decided to compensate up to 50% of the cost of restoring and building reclamation systems for water user organizations, the Ministry of Agrarian Policy and Food reported.
According to Resolution No. 628 “On Amendments to the Procedure for the Use of Funds Provided in the State Budget for Providing State Support to Agricultural Producers Using Reclaimed Land and Water User Organizations” developed by the Ministry of Agrarian Policy, farmers using reclaimed land can receive compensation for the reconstruction and modernization of existing or construction of new reclamation systems, as well as for the restoration of pumping stations.
The amount of assistance for farmers will not exceed UAH 26.5 thousand per 1 hectare of cultivated land subject to hydraulic reclamation, excluding the cost of sprinklers.
The budgetary subsidy is provided for the works and reclamation systems commissioned for the period from November 1, 2023 to October 31, 2024.
The Ministry of Agrarian Policy clarified that farmers will submit applications for budgetary funds and documents for it through the State Agrarian Register. The Ministry will announce the start of the application process later.