Сharacteristics of the current state of agriculture in Ukraine, including an analysis of its potential, problems and prospects of development. Description of major agricultural equipment used in Ukraine. Features of investment in agriculture in Ukraine.
Аннотация к работе
According to the Statistical Year Book of Ukraine (1996), about 71 percent of the country"s surface (41 million hectares) was used for agricultural activities. The number-two crop was sugar beets at 13.89 million metric tons, followed by wheat at 13.47 million metric tons. The main livestock product was beef and veal with 786,000 metric tons, followed by swine with 668,000 tons, and chicken with 194,500 tons. In recent years, agricultural production has declined drastically because of a decrease in the number of tractors and combine harvesters in working order and to the lack of fertilizers and pesticides. From 1995 to 1999, crop production declined by an average of almost 10 percent per year, while livestock production declined by an average of 9 percent per year.Of Ukraine"s total land area of 60 million hectares, roughly 42 million is classified as agricultural land, which includes cultivated land (grains, technical crops, forages, potatoes and vegetables, and fallow), gardens, orchards, vineyards, and permanent meadows and pastures. On the average, approximately 15 percent of fall-planted crops fail to survive the winter. The amount of winterkill varies widely from year to year, from 2 percent in 1990 to a staggering 65 percent in 2003, when a persistent ice crust smothered the crop. Barley has been the top feed grain in Ukraine for most of the past ten years in terms of consumption , surpassing wheat in the early 1990"s. Spring barley is typically planted in April and harvested in August, and is the crop most frequently used for spring reseeding of damaged or destroyed winter-grain fields.According to various resources, an immediate demand to replenish the physically depreciated farm and processing equipment in Ukraine is estimated at $5-10 billion, with an annual supply of $1-2 billion worth of farm equipment. Experts estimate the current level of physical depreciation of agricultural machinery and equipment at 70-80 percent, compared to 55-60 percent in 1999. There are about 40 manufacturers of agricultural machinery in Ukraine, which still supply a significant part of Ukraine agricultural machinery, in particular, ploughs, harrows, cultivators, seeders and sprayers. Production facilities at most agricultural machinery plants are currently being utilized at levels ranging from 15 to 30 percent. The price of domestically produced agricultural machinery is not cheap, because of inefficient and outdated manufacturing technologies.Most new shareholders leased their land back to newly-formed private agricultural associations, under the leadership of a director who was frequently, but not always, the manager of the former State farm. Ukraine agriculture is going through a winnowing process whereby unprofitable, usually smaller farms will either collapse or join more successful farms. Since many farms are already heavily in debt to banks or suppliers of fertilizer and plant-protection chemicals, and since agricultural loans are not guaranteed by the government, banks are largely unwilling to make longterm loans. Using land as collateral would enable farms to receive longer-term loans, but many farm directors remain leery of the Ukrainian banking system - which is not yet as stable as in Russia - and are reluctant to risk losing their land in default. In many cases, the best option is for a farm to attract an investor who can provide market expertise, operating capital, and collateral to enable the farm to secure loans.Farmland pai lease contracts enable contractors to consolidate large fields of 50-200 hectares located close to each other for the ease of crop rotation planning, cultivation and harvesting. Ukraine’s agricultural land cannot be purchased, but lease agreements for agricultural land enable as much freedom for performing farming operations as ownership while also providing a primary right of purchase in case of the agricultural land sale moratorium lift and given that pai holders would be willing to sell off their property. Cost of investment in Ukraine’s farmlands is the lowest in Europe while it provides the highest return potential given the high soil fertility and unrealized agri-ecological potential of Ukraine’s soils. Land lease rights acquisition cost in 2009 has ranged from USD 120 to USD 300 per hectare depending of the region and soil quality. Calculated per annum with fuel, spare parts, seeds, fertilizers, crop protection, labor costs, etc. included, annual cultivation cost from USD 200 per hectare using organic farming methods up to USD 500 per hectare with conventional/chemical farming.