{"id":273591,"date":"2017-11-16T11:05:53","date_gmt":"2017-11-16T09:05:53","guid":{"rendered":"https:\/\/vsisumy.com\/agro_sumy\/agrarnaja-sumshhina-2017\/"},"modified":"2026-01-02T20:32:41","modified_gmt":"2026-01-02T18:32:41","slug":"agrarnaja-sumshhina-2017","status":"publish","type":"agro_sumy","link":"https:\/\/vsisumy.com\/en\/agro_sumy\/agrarnaja-sumshhina-2017\/","title":{"rendered":"Agrarian Sumy Region – 2017"},"content":{"rendered":"
\n
Ukrainian farmers feed their country and supply products to another 147 countries.<\/strong><\/p>\n

Over the past 15 years, Ukraine has gradually turned into a kind of breadbasket of the world\u2014today, 147 countries buy food from us. Ukrainian food products are consumed by 140 million people worldwide. The Ukrainian agricultural market is diverse, and the trends of its development also vary, but we tried to take a closer look and talk about the most important ones.<\/p>\n

Height after height<\/strong><\/p>\n

Did you know that Ukraine ranks first in the world in sunflower production as well as sunflower oil, controlling more than half of the global market for this product? Our country also took first place in the world in 2016 in terms of growth rates of grain productivity, overtaking Brazil, ranked third in wheat yields, and took second place in the world in terms of grain export volumes after the United States. The list of such achievements can go on\u2014Ukraine has firmly taken its place among the world\u2019s leading agricultural countries. Agricultural exports accounted for 44% of total exports in 2016, bringing in $15 billion in revenue. There is one drawback\u2014by agricultural productivity, our country still lags behind the world\u2019s leading agricultural nations, and most agricultural production is concentrated in the hands of large companies, which carries both advantages and significant risks.<\/p>\n

Grain downside<\/strong><\/p>\n

One of the main risks for agriculture is bad weather. New agricultural technologies make it possible to somewhat mitigate its impact on yields, but in 2017 natural factors in Ukraine were so unfavorable that it was not possible to completely avoid a decrease in productivity. As of November 10, 2017, Ukraine harvested 55.1 million tons of grain and leguminous crops from an area of 13.4 million hectares; as a result, the total harvest may amount to about 60 million tons. In 2016, grain and leguminous crop production in net weight amounted to 66 million tons. The difference in figures is obvious even considering that 2016 was a record year in terms of yields in recent years. According to APK-Inform, the export potential of wheat in the current season will amount to 16 million tons, or 1.5 million tons less than last year; the export potential of barley decreased by 1 million tons, and corn by 3 million tons. Most likely, this will affect both a reduction in foreign currency revenue and a decrease in the profitability of agricultural producers. However, this will not affect the country\u2019s overall food security\u2014the capacity of domestic grain consumption lags far behind export potential.<\/p>\n

It is easier for the big ones<\/strong><\/p>\n

The decline in revenue will affect large grain producers the least\u2014Ukrainian agricultural holdings, which, according to various estimates, account for 50% to 65% of total grain production. For understanding, crop production is the main branch of Ukraine\u2019s agriculture and brings almost 70% of revenues from total production. Thus, the \u201cgrain kings\u201d are also the kings of all agricultural production. As of the end of 2016, 45 agricultural companies collectively controlled about 4.1 million hectares of farmland, and their total revenue approached $11 billion. The TOP-10 of these companies, according to a ranking compiled on the basis of integrated indicators for 2015\u20132016, looks as follows (see infographic No. 1). Many of them are built on a vertically oriented principle, i.e., they include everything\u2014from field cultivation to foreign trade together with transportation of grain to seaports, from where it goes directly to the buyer. A telling example is the agricultural company Nibulon, which grows the entire range of grain crops and has a river fleet on the Dnipro River that transports the company\u2019s products to the Mykolaiv and Kherson seaports, optimizing transportation costs.<\/p>\n

The TOP-10 grain traders of Ukraine, i.e., direct grain exporters, looks as follows (see infographic No. 2). As is easy to notice, the list partially coincides with the ranking of agricultural companies. According to market analysts, grain traders bring good profits to their founders, and in the event of reduced profitability, they compensate for it through lower grain purchase prices, thereby reducing the profitability of producers from whom they buy products.<\/p>\n

For large agricultural companies, a decrease in the profitability of one crop is compensated by the stable profitability of others, but in 2017, when weather conditions were unfavorable, this applied to almost all grains. The forecast looks slightly worse for small producers who grow a narrower range of crops.<\/p>\n

Paradox of shortage<\/p>\n

Regrettably, with the increase in product exports, Ukraine\u2019s agricultural market has faced a problem that was relevant exactly 100 years ago\u2014the growth of domestic food prices. On the foreign market, food costs more, and as a result, domestic prices are gradually catching up with export prices. The situation is exacerbated by shortages arising due to exports\u2014in particular, in 2017 this happened with poultry meat. Due to African swine fever, the pig population, according to the State Statistics Service, decreased by 9.2% over the year (or by 691.2 thousand head). As a result, the supply of pork on the domestic market fell, and prices increased by a record 44%. Accordingly, demand for poultry meat increased, but due to export contracts, poultry producers were unable to immediately meet it. In January\u2013August 2017, Ukraine sold 192 thousand tons of poultry meat abroad\u201424% more than in the same period of 2016. The result was an increase in chicken prices, which further fueled the rise in grain prices as well as compound feed components due to a poor harvest and the strengthening of the euro. Overall, following the results of January\u2013September 2017, Ukraine exported meat products worth $397 million, which is 1.5 times more compared to the same period a year earlier. Paradoxically, producers are not ready to meet the growing demand not only for pork and poultry, but also for beef. The export potential of beef is as high as that of poultry\u2014marketers claim that Ukrainian beef could be purchased in large volumes in the Muslim Middle East and African countries, but our livestock producers are not ready to supply it. Unfortunately, this particular case only confirms the sad rule\u2014food prices in Ukraine will continue to rise, the only question is the pace. The solution to this problem still has to be found jointly by the authorities and producers.<\/p>\n

Dairy rivers are drying up<\/strong><\/p>\n

The current year also brought a reduction in milk production to the agricultural market\u2014this is due to a decrease in cattle numbers. In January\u2013August 2017, it decreased by 0.9% compared to the same period in 2016\u2014to 7.172 million tons. Considering that in 2016 it decreased by 2.2% compared to the same period in 2015\u2014to 10.382 million tons, this is already a sad trend that no one is trying to reverse. Accordingly, by the end of the year, exports of powdered milk will be approximately 1 million tons less, while imports of dairy products will increase by 20%. At the same time, the share of industrial milk sales increased, which highlighted the trend of producers reducing milk purchases from the population and increasing them from large producers.<\/p>\n

There is potential<\/strong><\/p>\n

Despite the positive dynamics of development, numerous problems in the agricultural sector still limit the development of Ukraine\u2019s agricultural market. First of all, these include the high cost of credit resources, the lack of affordable leasing programs, underdeveloped agricultural insurance, and weak infrastructure\u2014primarily problems with Ukrzaliznytsia. However, the development potential of the agricultural sector remains high, especially in livestock farming and berry production, exports of which to Europe and Asia grew rapidly in 2017. There is also enormous potential in processing produced goods\u2014Ukraine should export not wheat, but flour made from it; not corn, but finished compound feeds. Only due to this can the profitability of the agricultural sector and the agricultural market grow many times over, and with them the living standards of Ukrainians.<\/p>\n

Achievements of Sumy region in agribusiness in 2017<\/strong><\/p>\n

In terms of grain and leguminous crop harvesting, Sumy region ranks 13th. In 2017, sugar production was restored in Sumy region.<\/p>\n

The agricultural market of Sumy region is an integral part of Ukraine\u2019s market, so the main trends of 2017 were also characteristic of our region. However, some differences from the nationwide situation were noticeable\u2014in particular, a sharp increase in sugar beet sowing areas and, as a result, a similar increase in yields of this crop.<\/p>\n

Sugar renaissance in Mykolaivka<\/strong><\/p>\n

The sugar \u201csecret\u201d of 2017 in Sumy region is explained simply\u2014in September, the sugar production season began\u2014the only sugar plant in the region resumed operations, located in the village of Mykolaivka (formerly Zhovtneve) of Bilopillia district. The first attempt to revive its operation ended unsuccessfully, and since 2013 the enterprise had not been operating. However, thanks to cooperation between the owner\u2014LLC \u201cUK.AZ.Druzhba\u201d\u2014and the Azerbaijani company ALKE, the enterprise resumed operations in 2017. Therefore, in 2017, LLC \u201cUK.AZ.Druzhba\u201d sowed 1.4 thousand hectares of leased land with sugar beet. In addition, it provided loans to farms for growing this crop. The result was not long in coming\u2014in 2017, the region harvested 2.8 times more sugar beet than in 2016 (496 thousand tons of sugar beet versus 120 thousand tons according to the Main Department of Statistics in Sumy region). This is despite the fact that the average yield of sugar beet was lower than in 2016 (39.2 t\/ha versus 42.5 t\/ha). During the season, the plant plans to produce 40 thousand tons of granulated sugar. Of course, not all of the grown beet will go to the plant in Mykolaivka\u2014part of the harvest will traditionally be processed by sugar plants in Kharkiv region\u2014but the very surge in sugar beet cultivation in Sumy region, which 20 years ago occupied up to one third of the region\u2019s sown areas, is symbolic in its own way.<\/p>\n

The decline in sugar beet yields in 2017 is not surprising\u2014weather conditions in Sumy region, as throughout Ukraine, were unfavorable for most crops. Many agricultural enterprises in the region also lost crops of various types on 49 thousand hectares of sown areas due to a hurricane with hail that occurred on July 1, which could not but affect overall yields and, as a result, reduce marketable production.<\/p>\n

A decent result<\/strong><\/p>\n

But overall, the gross harvest of grain and leguminous crops as of October 1, 2017 amounted to 1.417 million tons, which is even 1.7% more than in the corresponding period of the previous year. A similar situation is observed with corn harvesting. Overall, according to a ranking compiled by the Ministry of Agrarian Policy and Food, Sumy region as of October 1, 2017 entered the TOP-5 soybean producers, \u0443\u0441\u0442\u0443\u043f\u0438\u0432 only Poltava and Khmelnytsky regions. In terms of grain, leguminous crops, and sunflower harvesting, Sumy region ranked 13th in Ukraine.<\/p>\n

In general, the region\u2019s agricultural market is similar to that of Ukraine\u2014most land areas are cultivated by large agricultural companies such as Ukrlandfarming, Kernel, Agroprosperis, Agrotrade, Rostok-Holding, and others, which export their products worldwide. Smaller producers cooperate with the above-mentioned national grain traders, to whom they sell their products. Analysts say that large producers in Sumy region have long acquired their own grain elevators, which allows them to sell products evenly throughout the marketing year. Smaller producers are forced to sell their products only in autumn, since they do not have elevator capacities, have no opportunities to build them, and renting storage facilities is quite expensive and reduces profitability to a minimum.<\/p>\n

Problems with vegetables<\/strong><\/p>\n

In the above-mentioned ranking of the Ministry of Agrarian Policy and Food, Sumy region occupies one of the very last places (20th) in vegetable production. There is nothing surprising about this\u2014among large companies, only AgroBusiness-TSK systematically engages in vegetable growing, having built several modern vegetable storage facilities, which allows it to earn decent profits from off-season sales. Other vegetable supplies to the market depend on small farms, which determines their instability both in volumes and quality. Therefore, the need to create a wholesale agricultural market in Sumy remains relevant; its project was ready ten years ago. \u201cThe creation of such a market will stimulate farmers to increase production, expand crop rotation, experiment with agricultural crops, and produce not just raw materials, but products with added value. There is currently high demand for organic products, which could be successfully sold at a specialized venue. However, this concerns farm enterprises more than agricultural holdings, which do not have particular problems with selling their produce and are more dependent on price conditions,\u201d says Illya Yesin, deputy editor of the specialized agricultural site Latifundist.com.<\/p>\n

Vladimir Poshva<\/p>\n

Partners of the project \u201cAgrarian Sumy Region \u2013 2017\u201d<\/strong><\/p>\n

Agrobusiness TSK, LLC<\/strong><\/span>
Sumy region, Nedryhailiv district, village of Sakunyha, Ryabova St., 105
(05455) 5-88-05, 5-89-10<\/p>\n

Astarta, LLC<\/strong><\/span>
Sumy, Rymskoho-Korsakova St., 1
(0542) 64-08-20, 65-99-90, 65-99-91<\/p>\n

Zelenyi Svit, Trade and Consulting Center<\/strong><\/span>
Sumy, Zasumska St., 14, tel. (0542) 787-430
Internatsionalistiv St., 21, tel. (0542) 605-373
Romenska St., 59, tel. (0542) 792-889<\/p>\n

Urozhaina Kraina, LLC<\/strong><\/span>
Sumy region, Romny, Sumska St., 5E
+38 (05448) 5-77-16
www.ur-kraina.com.ua<\/a><\/p>\n

Article “\u201cUrozhaina Kraina\u201d \u2013 an agrarian innovator<\/a>“<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Ukrainian farmers feed their country and supply products to another 147 countries. Over the past 15 years, Ukraine has gradually turned into a kind of breadbasket of the world\u2014today, 147 countries buy food from us. Ukrainian food products are consumed by 140 million people worldwide. The Ukrainian agricultural market is diverse, and the trends of […]<\/p>\n","protected":false},"author":2,"featured_media":250584,"menu_order":0,"template":"","format":"standard","meta":{"footnotes":"","_wp_rev_ctl_limit":""},"tags":[],"class_list":["post-273591","agro_sumy","type-agro_sumy","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/agro_sumy\/273591","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/agro_sumy"}],"about":[{"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/types\/agro_sumy"}],"author":[{"embeddable":true,"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/users\/2"}],"version-history":[{"count":0,"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/agro_sumy\/273591\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/media\/250584"}],"wp:attachment":[{"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/media?parent=273591"}],"wp:term":[{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vsisumy.com\/en\/wp-json\/wp\/v2\/tags?post=273591"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}