The losses inflicted on the agricultural sector of Ukraine as a result of the war amount to $4 billion to $6 billion, representative of the UN Food and Agriculture Organization (FAO) Viktoria Mykhalchuk has said.
“Preliminary estimates from June indicate that the losses inflicted on the agricultural sector as a result of the war are between $4 billion and $6 billion, including damage to infrastructure such as irrigation equipment, storage facilities, shipping and processing infrastructure, greenhouses, field crops, and farm animals,” Mykhalchuk said at a briefing at the Ukraine Media Center in Kyiv on Friday.
She noted that this year, according to FAO estimates, Ukraine expects to harvest up to 51 million tonnes of grain.
“Given the areas that were directly affected by the war, only 61 million tonnes of the total of 75 million storage facilities are physically accessible. Some 14% are damaged or destroyed, and 10% are located on the territory occupied by Russia,” Mykhalchuk said.
According to her, of the available storage facilities, 35% remain filled with 22 million tonnes of grains and oilseeds, which are awaiting export.
“That is, only 65% of the storage facilities are available,” the FAO spokeswoman explained.
Mykhalchuk said that FAO is also working with the Ministry of Agrarian Policy and Food of Ukraine on alternative ways to export grain from Ukraine.
“One of the alternative ways that we are currently supporting is exporting through Romania and helping the Izmail laboratory to increase its capacity so that certification takes place much faster and, accordingly, the number of exports, possibly through these borders, increases,” she said.
Ukrainian agrarians need urgent support in replenishing working capital, prolonging loans and settling relations with retail chains, because due to the enormous debt to processing enterprises, agricultural producers cannot purchase raw materials and grain from farmers.
A corresponding appeal to Prime Minister Denys Shmyhal with a proposal to hold a joint meeting to find solutions to prevent negative trends in the grain market was sent on July 20 by members of the agro-industrial complex entrepreneurs’ committee at the Chamber of Commerce and Industry (CCI) of Ukraine, according to the website of the organization.
“It has never been as difficult as it is today for farmers. The situation needs state intervention due to a number of problems: there are ultra-low purchase prices, lack of storage facilities, slow logistics, retail debt,” the Chamber of Commerce and Industry quotes its member, first vice- President of the Association of Farmers Viktor Sheremet.
According to the Chamber of Commerce and Industry, due to the blocking of Ukrainian maritime logistics, hostilities, higher fuel prices, shortage of working capital and lower prices for agricultural raw materials, a significant reduction in winter crops for a new crop is expected.
“Probably, the current crop of corn will remain under the snow,” the organization stressed in the appeal.
In addition, this year a serious challenge for farmers will be the purchase of seeds, fertilizers, fuel, the preservation and export of grain, a number of enterprises and farms are expected to go bankrupt due to the loss of access to export products and the challenges facing the agricultural sector of Ukraine.
“Given the threats that complicate the situation on the market, following the results of the discussion of industry problems, the meeting participants decided to appeal to the Prime Minister of Ukraine Denys Shmygal with a request to hold a joint meeting with interested ministries and departments, business representatives, industry associations, donor organizations to consolidate efforts to search for effective solutions to ensure the organization of the harvesting campaign, storage of grain, autumn sowing and activation of exports,” the Chamber of Commerce and Industry concluded.
