Ukraine is gaining again it’s agricultural power

Ukraine is now the world’s largest grain exporter and the third largest supplier of agricultural produce to the European Union. With trade volumes experiencing double-digit growth and investment flowing into the Ukrainian agribusiness sector, the country looks set to play an increasingly major role in global food security.

According to European Commission figures, the United States is currently the number one agricultural exporter to the European Union with an annual volume of EUR 12.9 billion. America is followed by Brazil (EUR 11.7 billion), with Ukraine (EUR 6.3 billion) ahead of China (EUR 5.9 billion) in the number three spot. Nor is Europe the only place where Ukrainian foodstuffs are gaining market share. Over the past five years, the geographical distribution of Ukraine’s agricultural exports has expanded significantly, as the country’s agribusinesses have looked beyond the traditional markets of the former Soviet Union and sought to expand their presence in Asia, Africa and beyond.

Fittingly for a nation known historically as a breadbasket, Ukraine’s top agricultural export remains grain. As the annual grain export season ended on 30 June, Ukraine was poised to claim Russia’s crown as the world’s number one grain exporter with a yearly total of 49.7 million tons sold to international clients, representing a 26% increase on the 2017-18 cycle. This volume was possible thanks to a record 70 million ton harvest in 2018, but Ukraine’s Ministry of Agrarian Policy and Food believes this was no one-off and expects further gains during the current cycle.

Grains will likely remain one of the pillars of Ukraine’s agricultural export industry, but the range of commodities sailing out over the Black Sea from Ukrainian ports or heading west across the country’s EU borders is far wider. There has been a concerted effort to gain access to new international customers in recent years, with Ukrainian food exporters securing entry to 85 new markets for a variety of agricultural produce in 2018 alone.

In mid-June 2019 Ukraine received the necessary veterinary certification to begin milk and dairy product exports to Saudi Arabia. Weeks earlier, nearby Qatar certified Ukrainian meat, fish and dairy imports. The challenge now is to produce more value-added foodstuffs domestically in addition to the current focus on commodity exports. Increased production within Ukraine would allow the country to benefit from a greater share of end revenues and boost the economy further.

The rise of Ukraine as an agricultural superpower comes as no surprise. The country is home to around one-third of the world’s famously fertile black earth stocks and boasts ancient national folklore rich in agrarian symbolism. With the global population set to soar beyond the 10 billion barriers in the coming decades, Ukraine’s unrivaled agricultural wealth will become a resource of the highest strategic importance, while also serving to attract international investors to the country’s agribusiness sector. Recent years have seen a steady stream of major investments into Ukraine’s agricultural infrastructure, with domestic and international companies alike financing the construction of storage and processing facilities while upgrading wagon fleets and port capacities.

Meanwhile, in society, there are talks of ending Ukraine’s agricultural land sale moratorium and creating a long-awaited land market. This would be a hugely controversial move in a society where the emotional attachment to farmland runs deep, but it would also represent a potential bonanza for the national economy that may prove hard to resist. Regardless of how this land sale saga develops, it is already clear that Ukraine is destined to play an increasingly prominent role in global food security.


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