Ukrainian State-Funded Program on Development of Potato Sector
KYIV. Feb 17 (Interfax-Ukraine) – The Institute of Agrarian Economics jointly with the Ukrainian Association of Potato Producers have developed a state-funded program for the development of industrial potato growing for 2021-2025, which provides, in particular, the construction of potato storage facilities with 30% funding from the state.
According to a press release of the association, the implementation of the program will allow building 35 potato storage facilities in Ukraine with a total storage capacity of 158,600 tonnes. In particular, four storage facilities for potatoes with a total capacity of 41,000 tonnes will be built in Cherkasy region, eight storage facilities for 38,200 tonnes in Lviv region, six storage facilities for 29,000 tonnes in Chernihiv region, three storage facilities for 15,000 tonnes in Zhytomyr region, and two storage facilities with a capacity of 17,000 tonnes in Kherson region. In other regions, construction is planned in smaller volumes.
"The average cost of building such a storage facility is UAH 10-12 million. If we consider that a loan for such construction costs 27% per annum, it becomes clear why small and medium-sized industrial potato producers cannot afford such costs," the association said.
In February, the association wrote a letter to Ukrainian President Volodymyr Zelensky asking for assistance in adopting a state-funded program for the development of industrial potato growing for 2021-2025 developed by experts from the association and the Institute of Agrarian Economics at the request of the Ministry for Development of Economy, Trade and Agriculture.
The association said that the state budget will receive UAH 3.8 billion in taxes, fees and growth of VAT revenues for five years of the program if it is approved.
According to the association, the number of industrial potato farms in Ukraine is reduced annually by 10-13% due to unprofitability, riskiness and the need for high investment. Thus, according to the association, if in 2017 some 1,296 farms were engaged in industrial potato cultivation, in 2018 their number decreased to 1,114.