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.
The spread of coronavirus in some cases can be recognized as force majeure, the consequences of which did not allow fulfillment of obligations under economic contracts, President of the Chamber of Commerce and Industry of Ukraine (CCI) Hennadiy Chyzhykov has said. “The CCI of Ukraine receives a large number of requests regarding the recognition of the spread of coronavirus as force majeure. The CCI very carefully approaches this issue and relies on international practice and the legal framework,” he told Interfax-Ukraine.
At the same time, Chyzhykov said that in general “coronavirus, like flu, is not a basis for evidence of force majeure.”
According to him, the basis for evidence of force majeure is the presence of one or more circumstances stipulated by law. Among them are such circumstances, including an epidemic.
In addition, force majeure circumstances may be determined by the parties in the text of the contracts.
“The presence of force majeure circumstances in the contracts such as an epidemic, an emergency situation in the healthcare sector or restrictive actions of the authorities, strengthens the position on the recognition of facts that do not allow the fulfillment of relevant obligations. But it is always necessary to provide evidence that it is coronavirus or measures to combat its spread that are circumstances that could cause the inability to fulfill obligations,” Chyzhykov said.
He also said that a party that refers to force majeure circumstances should contact the competent authority (the chamber of commerce and industry) of the country where these circumstances arose, and obtain the appropriate document (certificate), so that it can be presented to the counterparty according to terms of the contract.
