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Business urges to prevent the grain export ban

17/ 04/ 2020
  The grain market is extremely important for the economy of Ukraine and its financial stability. The production, processing, and export of cereals and oilseeds make a significant contribution to the state budget. In addition, a significant number of the countrys population is employed in this sector. At the same time, Ukraine has great potential in the agricultural sector and claims to become the world leader in grain production. Accordingly, stability and predictability of grain exports are a priority for our country and one of the main factors of national and food security. For nine marketing years, Memoranda of Understanding between the profile ministry and the grain exporting business has been one of the main factors to maintain a balance between domestic grain consumption and export opportunities. However, the grain business community is currently concerned about a possible export ban in case of exceeding the established wheat export limit and urges not to repeat the mistakes of previous Governments. It is worth recalling that over the six years between 2006 and 2011, grain export restrictions were introduced several times in Ukraine. This had extremely negative consequences for the industry and the countrys image on the international stage. Thus, according to experts of the European Business Association, the introduction of export restrictions has significantly worsened the reputation of Ukraine as a reliable supplier of grain in world markets and a favorable environment for conducting agrarian business. In addition, it caused significant losses to the agricultural sector. In particular, the business community estimates that producers revenue loss from the introduction of quotas in the 2010/11 marketing year ranges from 1.9 to 2.6 billion USD. The business emphasizes again that the agricultural sector has a strong potential for the development of the Ukrainian economy, so the public policies and its consequences in this sector should be carefully analyzed and aimed specifically at the development of the sector in the long run. At the same time, Ukraine should give a clear signal to producers, trading companies and consumers in the world markets that it is a responsible partner and a reliable exporter of agricultural goods. The European Business Association calls on the Government to prevent any restrictive measures regarding oil and grain exports. Business appreciates the dialogue with the Ministry for Development of Economy, Trade and Agriculture and is ready to continue the cooperation with the Government in this context.    

The grain market is extremely important for the economy of Ukraine and its financial stability. The production, processing, and export of cereals and oilseeds make a significant contribution to the state budget. In addition, a significant number of the country’s population is employed in this sector.

At the same time, Ukraine has great potential in the agricultural sector and claims to become the world leader in grain production. Accordingly, stability and predictability of grain exports are a priority for our country and one of the main factors of national and food security. For nine marketing years, Memoranda of Understanding between the profile ministry and the grain exporting business has been one of the main factors to maintain a balance between domestic grain consumption and export opportunities.

However, the grain business community is currently concerned about a possible export ban in case of exceeding the established wheat export limit and urges not to repeat the mistakes of previous Governments. It is worth recalling that over the six years between 2006 and 2011, grain export restrictions were introduced several times in Ukraine. This had extremely negative consequences for the industry and the country’s image on the international stage.

Thus, according to experts of the European Business Association, the introduction of export restrictions has significantly worsened the reputation of Ukraine as a reliable supplier of grain in world markets and a favorable environment for conducting agrarian business. In addition, it caused significant losses to the agricultural sector. In particular, the business community estimates that producers’ revenue loss from the introduction of quotas in the 2010/11 marketing year ranges from 1.9 to 2.6 billion USD.

The business emphasizes again that the agricultural sector has a strong potential for the development of the Ukrainian economy, so the public policies and its consequences in this sector should be carefully analyzed and aimed specifically at the development of the sector in the long run.

At the same time, Ukraine should give a clear signal to producers, trading companies and consumers in the world markets that it is a responsible partner and a reliable exporter of agricultural goods.

The European Business Association calls on the Government to prevent any restrictive measures regarding oil and grain exports. Business appreciates the dialogue with the Ministry for Development of Economy, Trade and Agriculture and is ready to continue the cooperation with the Government in this context.

 

 

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