Power supply, foreign loans to be main challenges to Ukrainian agriculture in 2023 - deputy minister
MOSCOW. Dec 9 (Interfax) - Power supply restricted by the damage done to Ukraine's critical infrastructure and access to foreign loans will be the main challenges to the Ukrainian agriculture and food industry next year, considering that Ukraine does not have sufficient financial reserves to provide for this sector, Ukrainian First Deputy Minister of Agrarian Policy and Food Taras Vysotsky said.
The Ukrainian agriculture and food industry will definitely run into power supply problems in 2023, the Ukrainian media quoted Vysotsky as saying at the "Doing Agribusiness in Ukraine" conference organized by Ukrainian Agribusiness Club on Thursday.
"There are initiatives under which international partners will be providing generators. They will be directed to social infrastructure in the first turn, yet it will soon be the turn of business [where the generators will be allotted] via the State Agrarian Registry (SAR)," Vysotsky said.
The Ukrainian government will consider vesting the Ministry of Agrarian Policy and Food with the power to initiate the inclusion of certain agricultural and food enterprises in the list of critical infrastructure elements to receive power supply in the first turn, Vysotsky said. That will provide power supply to enterprises, which really need it, and the entire industry will be able to deal with the energy crisis in a while, he said.
Ukraine should continue to develop the bio-energy industry and to implement energy self-sufficient solutions at particular enterprises, he said.
Financing will constitute another challenge to the agriculture and food industry next year, Vysotsky said.
"State portfolio guarantees and bank loans provided under the 5-7-9% program were helpful in 2022. However, it will be problematic to use this source, because prices of agricultural products are not as high as necessary to repay these loans. Objectively, the entire margin is spent on logistics. So, apparently, talks on the profitability and loan rescheduling until 2025 and later years will need to resume in the future, while it will be necessary to find a source of loans in 2023," he said.
Ukrainian Agribusiness Club is taking part in negotiations with international financial institutions on the funding of the Ukrainian agriculture and food industry, Vysotsky said.
"I will not disclose the amounts now, but if this happens, it can help the Ukrainian agriculture and food industry live through next year and accommodate its operating needs. The entire production chain will benefit, and it does not matter whether the financing is provided via resource companies (seeds or plant protection products), banks through which resources will be purchased, or through projects. The main thing is that it must come from the outside, because internal sources are limited," he said.
