Compared with the nearest neighbors, Lithuanians, Belarusians, Poles, and Russians, Ukrainian farmers overpay 40% for fertilizers. Gennady Novikov, chairman of the Agrarian Union of Ukraine, spoke about it at the press conference.
According to him, a sharp ban on imports from Russia and the too high price of Ukrainian producers make our farmers buy fertilizers in Poland, Lithuania, Kazakhstan and even in the United States. But these supplies can not cover the need.
As a result, farmers put less fertilizer. And the consequences will be evident next year, due to the poor soil conditions, the quantity and quality of the harvest will decrease. At the same time, due to the shortage, the cost of fertilizers will grow even more.
As of the end of October, the need for farmers to use nitrogen fertilizers increased by 5% due to changes in the structure of crops. If last year it was 359 thousand tons of active substance, this year it is 375 thousand tons.
At the same time, the supply on the market is 26 thousand tons less than last year, says Vitaly Sabluk, deputy director of the Institute of Agrarian Economics. Another part will go for the creation of the so-called “security zone”, additional resources in the traders’ warehouses.
“Last year, we estimated security stocks at 35-40 thousand tons. That is, there were 106% of the demand on the market for fertilizers, but manufacturers got only about 95%. This year it is difficult to say objectively, but the reserves will definitely be large. This is evidenced by data of the associations, and traders. Some say about 60 thousand tons, others expect even 100 thousand tons,” Sabluk says.
That is, 20-24% of fertilizers will remain by traders. If we add a decrease in supply on the market by 6% and an increase in demand by 5%, then the deficit will be about a third.
Experts note that previously 90% of fertilizers came to the Ukrainian market from Russia. But the government introduced restrictive measures, at the same time seeking to support the Ukrainian manufacturer. As a result, there is not enough fertilizer. And it is not because we lack power.
The only way to provide farmers with domestic-made fertilizers is to give producers cheap gas. There is no other way, the vice-chairman of the Ukrainian Agrarian Council, Mikhail Sokolov is sure.
“Roughly speaking, all global fertilizer producers have cheap gas. And buying it for $ 300, when others pay $ 60, it’s impossible to compete,” he concluded.