Business news from Ukraine

Representatives of oil and fat industry ask to increase export duty on sunflower

22 October , 2022  

Representatives of the oil and fat industry of Ukraine are asking the Ministry of Economy of Ukraine to increase the duty on the export of sunflower seeds to 10% from 3.5%, this will allow them to be processed domestically into higher-margin sunflower oil, especially in the face of a reduction in the oilseed crop in 2022 from – for the aggression of the Russian Federation.
The proposal to create a working group between the ministry and the specialized association “Ukroliyaprom” to resolve the relevant issue was made by its representative Stanislav Tarshin, the beneficiary of the GradOlia company.
“We understand that the gross harvest of sunflower this year will be 30% less than last year, not 16 million tons, but 9-10 million tons. You can assume that since the beginning of the war, 1.7 million tons have already been exported, and no less will be taken out in the future. We will again be left without jobs, without receiving foreign currency and other things,” he stressed during a panel discussion with Economy Minister Yulia Sviridenko at the business forum “Dialogue between civil society, business and government: wartime challenges” in Kyiv on Friday.
He emphasized that the oil and fat industry of the country may face a shortage of raw materials for the production of sunflower oil due to a smaller sunflower crop in Ukraine in 2022 due to Russian invasion and temporary occupation of part of its territory. This can lead to underloading of enterprises in the industry, a reduction in foreign exchange from oil sales abroad, as well as the closure of enterprises and an increase in unemployment in the country.
To prevent such a development of events, Tarshin proposed to establish a duty on the export of sunflower seeds from the country at a rate of 10% instead of the current 3.5%.
In addition, the representative of Ukroliyaprom called on the Minister of Economy to stimulate deep processing of sunflower oil in Ukraine, including its purification and packaging before selling it abroad.
“We should have reduced the export of crude sunflower oil (in favor of processed – IF-U). Many people think that if we export not sunflower, but crude oil, then this is the final product. This is a big mistake – such oil is a raw material that is subsequently processed many countries of the world. We export 6-6.5 million tons annually, while we only eat 0.5 million tons in the country,” Tarshin specified.
According to him, in order to increase the deep processing of sunflower oil by 50% of the current level, it will be necessary to build about 20 enterprises of this profile in Ukraine, which will additionally create tens of thousands of jobs in the country.