Published 6:30 pm Thursday, February 22, 2024
Grain and oilseed production remains unprofitable for Ukrainian farmers for the second year in a row.
Low prices, limited exports and complicated logistics mean “significant” financial losses, said Antonina Broyaka, a Kansas State University Extension associate who fled Ukraine when the war broke out.
“Indicators for the next year are unlikely to be positive,” she said. “Currently, achieving pre-war indicators is out of the question.”
The cost of logistics “skyrocketed” in 2022 and declined in 2023 due to lower diesel prices and lower volumes for export, but has begun to grow again with suspension of the Black Sea Grain Initiative, Broyaka said.
The high cost of logistics has prevented farm profitability. Sales on both local and export markets generate losses.
Feb. 24 marked two years since Russia invaded Ukraine. It’s also been 10 years since Russia invaded Crimea.
“For 10 years, Ukraine has been fighting against an aggressor which is 300 times larger in territory and three and a half times larger in population,” Broyaka said. “We will not give up, because this is our land and our home.”
Broyaka spoke Feb. 21 during a KSU webinar.
The war has caused $156.3 billion in direct damage to the Ukrainian economy, and $499 billion in indirect damage, including $69.8 billion in agricultural losses, Broyaka said.
Nearly 20 million acres need to be de-mined, including nearly 5 million acres in liberated territories and 15 million acres in occupied territories.
About 677,000 acres were de-mined in 2023, with 514,000 acres returned to cultivation.
It costs about $1,800 per hectare, which is 2.47 acres, to de-mine the ground, Broyaka said.
Ukraine had a total grain storage capacity of about about 63 million tons before the war. Today, it has a capacity of about 54 million tons.
There were 1,286 grain elevators in Ukraine in 2021, and today there are 1,171, a loss of 115. Some elevators damaged by shelling have resumed their work. Many new storage facilities have been built in safer regions closer to the western borders, Broyaka said.
Input costs have stabilized, but yields are not reaching pre-war levels, Broyaka said.
Ukrainian farmers primarily use saved seeds, Broyaka said. In 2022, new seeds were about 10% of total production. That fell to 5% in 2023.
In 2023, the fertilizer application rate declined by at least 20%. Fertilizer prices remain higher due to costly lower import logistics and lower domestic production of fertilizers, she said.
“With high production costs, Ukrainian farmers received nothing — just losses,” Broyaka said. “Last year, farmers didn’t have profits, so they’re still not able to buy enough fertilizers and plant protection products just due to lack of money.”
Reduced application rates meant lower costs for growers, Broyaka said, but it means lost soil fertility and grain quality.
U.S. aid is “very, very important,” Broyaka said.
“We just pray that America will finally pass this package for humanitarian and military help for Ukraine,” she said. “If America doesn’t help, we lose. I just ask and pray that America will continue to support Ukraine.”
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