For some farmers in Ukraine, it is getting tougher and tougher to break even or to make ends meet.
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“There is no other option but to stop agricultural production next year”
This is what Rostok-Holding CEO Dmytro Kupavtsev says. The entire land bank of 35,000 acres of the agro-industrial group Rostok-Holding is located in Chernihiv region. And part of the land is in a risky 20-kilometre zone along the border with Russia, which is mined and constantly under fire. For two years now, the company has not been cultivating it and has relocated the dairy farm.
“The farm is in Hremyach, a village just 300 meters from the border with Russia. We bought it in 2013 and invested $1.5 million in modernization in 2021. On February 24 last year it was occupied. The cows were lactating, so we had no choice but to give away milk for free to the population during the 35 days of occupation, and add the remaining milk to the cows’ ration or spill it out. So after the de-occupation, in April, I started working on relocating the farm, as I knew that the Russians would not leave us alone.”
While the farm keeps working, it is more challenging for crop production. Next year, it is likely that the company will not cultivate the land in the safer zone either. This means that 200 workers will lose their jobs and 700 shareholders will be left without rent.
“It’s been two years now that many farms in our area have not planted at all. So as the war continues, very soon many agricultural enterprises will be lost. Many farmers are selling their businesses.”
Logistics and weak grain prices are the primary reasons for the economic troubles. Last year, shipping from the farm to the borders and ports cost $2.7 per bushel. The average grain price was $5.4 per bushel. That is, half of the cost of the grain price is logistics.
“With such prices, we went into the red. The cost of corn production is $4/bushel, the selling price is $5.4/bushel, and logistics is $2.7/bushel. This is the cost that was before the full-scale invasion when gas, seeds and fertilizers had completely different prices”
How does one manage to keep up in such circumstances? Dmytro says he is used to being optimistic, but this time it is not easy.
“I don’t even know what to say. I keep thinking that everything will be fine. But today I have realized that unfortunately, I have to stop”
That report was powered by Latifundist Media, with USAID support provided through the Agriculture Growing Rural Opportunities (AGRO) Activity implemented in Ukraine by Chemonics International. For more information, visit their website or follow them on social media.
