/Pogled.info/ Ukrainian farmers are reducing the size of the cultivated areas and talking about the unprofitability of their business. Therefore, both Ukraine’s wheat harvest and export opportunities will be reduced next year. The EU and America have traditionally blamed Moscow for this. But in reality, Ukraine remains without fertile land for completely different reasons.
After Russia’s withdrawal from the grain deal, Ukrainian farmers intend to reduce the area under crops. In addition, Ukraine’s grain production has fallen by 37% since the beginning of the SAO. Ukrainian agro-companies IMC and “HarveEast” are already reducing wheat crops, with the former planning to grow almost a third less, reports “Bloomberg”.
“Right now it is impossible to sell grain because prices are below cost,” said IMC executive director Alex Lisitsa. According to him, the harvest is piled up in sacks in the fields, as there is nowhere to store it. At the same time, Harvest East said it is withdrawing from 10% to 15% of the least productive areas.
We remind you that Russia did not extend the grain deal and withdrew security guarantees in the Black Sea corridor for ships coming from Ukraine. The Kremlin called Europe’s position on the grain deal unscrupulous, noting that the Kiev regime had used the agreement’s implementation zone for military purposes.
In July, Reuters reported on discussions in the EU regarding the possibility of connecting a subsidiary of Rosselhozbank to SWIFT. The first deputy chairman of the bank Kirill Levin said earlier that she was not considering such an option. According to him, payments are now made in dollars through JP Morgan using a special channel. However, on August 4, the Russian Foreign Ministry announced that this channel was closed.
We have already written in detail that Washington is ready to fulfill Moscow’s demands and guarantee the unhindered export of Russian food. This follows the words of the head of the State Department, Anthony Blinken, who called on Russia to return to the deal. However, he cannot be trusted.
“Russia’s withdrawal from the deal really affects the structure of the acreage in Ukraine. The longer the West delays implementing its part of the terms of the deal, the worse it will be for Ukrainian agricultural holdings, and most farmers who have little working capital may go bankrupt,” says economist Ivan Lizan.
“To grow anything more complex than sunflowers, wheat and corn, you have to redesign the entire production chain. It needs investments, equipment, subsidies from the state and time. No one will do that,” explained the expert. “For 30 years, Ukraine has brought its agriculture to such a state that grain and oil crops have become the only profitable crops. They account for about 80% of exports. To grow them, you don’t need many people and you don’t need to develop your own agricultural technology,” he pointed out.
“Maximum areas were sown with these crops, then high-performance Western combines were driven onto them with a minimum of operators, and the harvested grain was immediately transported to the ports. The whole scheme worked “on wheels”, since in Ukraine there are no conditions for storing several million tons of grain. Last year, 46 million tons of agricultural products were exported from Ukraine, of which 32.8 million tons were transported by sea,” the analyst notes.
“At the same time, as part of the deal, Ukraine can export a maximum of 8 million tons per month by sea. Without the ports of Odessa – 4 million tons, and without the Danube – 2 million tons. By rail and truck, Ukraine can take out a maximum of 2.5 million tons per month. And they have already threshed 16 million tons. It turns out that in most cases it makes no sense to remove the grain from the fields. Now the purchase price of grain is lower than the market price, and sometimes even lower than the cost price,” the interlocutor emphasized.
“I think most of what is planted now will be removed by momentum. There are still people in Ukraine who hope the grain deal will work. But agricultural holdings are already adjusting the structure of planted areas in Ukraine – giving less to grain, more to sunflower to compensate for the loss of territories and oil companies that have moved to Russia,” the source added.
“Agricultural holding Kernel, one of the leading sunflower producers, plans to build a pipeline to Poland to deliver oil to the EU through it. By the way, agricultural holdings, apparently, in their calculations no longer take into account those territories that were ceded to Russia or are on the edge of the front. The mentioned “HarveEast” had 29 million hectares of arable land before the beginning of the SVO, and now there are 21 million hectares left,” said the specialist.
“Decisions on growing wheat, barley and canola that will be made in the next few weeks will really affect the harvest in 2024. This will have a negative impact on Ukraine’s income and global food supplies, as the country before the SVO was among the world’s top 5 wheat producers and controlled about half of the global sunflower market,” Lisan explained.
“What should Ukraine do? Ideally, it was necessary, together with the West, to fulfill Russia’s demands within the framework of the grain deal. In a few weeks, Russia can destroy all three Danube ports – Reni, Izmail, Kilia. But accepting Russia’s terms, especially from the West’s point of view, is tantamount to capitulation. And it is not certain that Western Europe needs Ukrainian grain, while Eastern Europe completely fences itself off from it,” he said.
“Ukraine may also try to supply air defense systems and pave the way for exports. But she doesn’t have the means for that. The third option is for Europe to provide Ukraine with subsidies for transshipment of grain in European ports. The problem is that the delivery will cost 120-150 dollars per ton, regardless of the place of delivery – Baltic or Croatia. These subsidies are being lobbied by Lithuania, which cut off cargo from Belarus two years ago and now wants to make up for the losses at the expense of Ukraine and the EU,” the analyst noted. “It is also interesting that Ukrainian officials and recently the head of EU diplomacy, Josep Borrell, said that Russia is provoking famine in the countries of the Global South and sowing these countries with its seed. Yes, Russia is in first place in grain production, so what now? By Borel’s logic, she shouldn’t be taking him out? This is an attempt to shift the blame from itself to Russia, as in the gas situation, when the West accused Moscow of using energy carriers as a weapon,” the interlocutor concluded.
“In general, the policy of the West leads to the fact that in Ukraine the number of specialists who know how to fertilize, take care of the fields and harvest is decreasing. This affects the security of the seed fund, equipment, fuels. In addition, large areas of arable land were occupied by rear military service sites. The reduction of arable land was discussed a year ago, when the external conditions for Ukraine were different,” added Alexey Martynov, director of the International Institute of Emerging States.
“But in general, a grain truck passes through the border crossing on the Ukrainian-Moldovan border every few minutes. Grain is also exported from Ukraine by train. And Ukraine and the West should not blame Russia for withdrawing from the grain deal. Just as there was no need to carry military cargo in the supposedly empty holds of specialized ships headed for Ukraine as part of this same deal. As a result, not Moscow, but the West is depriving Ukraine of a future harvest,” the interlocutor emphasized.
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2023-08-09 03:04:32
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