Russia's aggression against Ukraine is trying to devastate our national economy. According to preliminary estimates of Ministry of Agrarian Policy and Food of Ukraine, the agricultural sector only have lost $30 billion, including $4 billion in direct losses from destroyed and stolen property and $22 billion in lost profits. However, even in the conditions of full-scale military aggression with a front line of more than 2 thousand km, the Ukrainian agricultural sector continues its work and not only survives, but also dynamically moves to restore its pre-war volumes. What helps it and what hinders it? We talked about it with the head of one of the largest agrarian associations of Ukraine, the Ukrainian Agrarian Council (UAC) and the founder of the SAVE UA charitable foundation Andriy Dykun. 

What challenges do agricultural producers face on the 7th month of full-scale war?

In the conditions of war, agricultural producers in Ukraine can be divided into three groups by types of problems: those that were not occupied, de-occupied and those that are under occupation. For those that did not hear the loud explosions, the main problem is to sale the products. We all know that ports were closed from the beginning of the war until August. All agricultural exports were redirected to the western borders, which were not ready for such volumes. Until February 24, Ukraine exported 7 million tons of agricultural products every month, 5 million tons of which were exported by sea ports, in March this year the total export fell to 0.3 million tons. But gradually, by August, this figure was increased to 4.5 million tons. If the "green corridors" continue to work, we expect to see positive figures.
However, there is another problem. Blocking exports and high stocks have made local prices lower than the cost of production. And this threatens the sowing campaign next year. Farmers simply will not have financial opportunities. 

How can these problems be neutralized by farmers? What steps should be taken by the government? 

We hope that this problem will be solved by the extension of the "Istanbul Agreement"/​​the Black Sea Grain Initiative and grain will continue to leave Ukrainian ports. We also hope that the state will buy about 20-30% of the accumulated grain from farmers at normal prices so that our farms have money to continue the sowing campaign in the spring of 2023. This is a significant amount, according to our estimates it is $4 billion. And in the conditions of war, the Ukrainian government has to direct all funds to military needs. Without the help of our Western partners, we are unlikely to receive this sum, but it must happen, because it will help us survive and go to the fields in the spring. 

What losses does Ukraine expect in the crop sector in general? How much harvest, in your opinion, will be harvested this year? 

According to our estimates, we expect about 60 million tons. The Ministry of Agrarian Policy and Food announces 68 million tons. The losses are undoubtedly large. But if we compare not with the last year, which was a record for the entire history of Ukraine's independence - 107 million tons, the figures do not seem so terrible. After all, on average, Ukraine harvested about 70 million tons per year. 

What about livestock? What losses and terms of recovery are we talking about?

After all, compared to crop production, this area is much more difficult to restore.  Current loss of commercial pig production output is estimated at 13-15%, so yearly pork production is likely to decrease to 365-380 thousand t carcass weight equivalent compared to 432 thousand t last year. The industry perspective for the nearest 1-2 years is to reach the pre-war levels of production. We see similar indicators of decline in the dairy sector. 

According to the Association of Milk Producers, the volume of livestock losses in the industrial sector as of September 1 amounted to more than 50 thousand cows. 
The total volume of milk production for 8 months sank by -15% to 5.1 million tons.

However, despite significant losses of dairy cattle in the industrial sector, milk production from dairy farms fell by only 7% (to 1.7 million tons) over 8 months compared to the same date last year. Losses in private households are much higher - more than 18.6% (to 3.4 million tons). 

However, we expect acceptable final figures this year. By the end of the year, the level of milk supply for processing will not be lower than 2 million tons (last year - 2.48 million tons), which will be enough to continue the work of the market. 

All this is possible only with the support of all sectors of the agricultural sector now. If the support is not provided in time, we can lose the entire sector, especially the livestock industry. 

What should destroyed farms do? Can we believe that documenting losses properly will help to return funds for lost property?

This is one of the areas that UAC is working on together with USAID-AGRO. Together with international legal experts and our lawyers, we have developed a methodology for fixing losses. At the UAC level only, there are already more than 100 enterprises that have applied to us, and we are now supporting them in this process. After the victory, we know that there will be access to russian money as reparations, there will be international support. Therefore, what was lost as a result of hostilities must be properly recorded and legally registered. We are helping to do this. I believe that those who have applied will be partially or fully compensated for the lost of the property and profits. 
The growth of energy tariffs can kill many farms in Ukraine. Will the mass construction of biogas plants be able to correct the situation? What should the state do to ensure that every farmer, with 2 thousand hectares under cultivation, has the opportunity to provide himself with biogas, biomethane for himself and the surrounding villages?
The Cabinet of Ministers of Ukraine recently enacted a resolution that allowed adding the produced biomethane to the general gas transmission network. Further, this fuel can be exported abroad. This has already revived this market and entrepreneurs have already started pilot projects to produce biomethane for networks with traditional gas. Biomethane for pipes or biogas, from which they produce electricity and provide light for themselves and the surrounding villages, can really be a way out of the current situation in the energy market. It can also become an additional source of income for agricultural enterprises. Two factors can develop this industry: state support and clear rules of the game in this market. The first one can be immediately excluded, because in the conditions of war the state will not allocate money for this. But the state is able to create transparent and equal, competitive conditions for everyone who wants to do this business. 

What ways do you see to restore the agricultural sector after the victory?

We must develop added value, and this cannot be achieved without processing companies. Ukrainian farmers can and want to start creating added value today. These should be large companies for the processing of agricultural raw materials.  Or, following the example of the United States, we need to unite in agricultural cooperatives, which will also be engaged in processing.

We also need to learn how to produce more on one hectare than now. But to organize these processes on a national scale, we need knowledge. We have already started negotiations with the University of Iowa on the creation of an agricultural university that will help Ukrainian farmers to increase efficiency: to start producing more products using the same area. 

Where else should farms look for support? 

From the first days of the full-scale war we started the work of the humanitarian center. We already have experience in helping people and businesses in crisis situations. I can name the main periods, it was 2014 at the beginning of the war with russia, it was a pandemic, and February 24 this year.

This time everything is much more large-scale, so I, with the support of the UAC, AMP, APP founded a powerful charitable fund SAVE UA. 

Our main task is to ensure food security in Ukraine. This cannot be achieved if we do not support the agricultural sector now. From the first days of the full-scale war, we have been helping agricultural producers. We involve our colleagues and business from European countries. 

Together with USAID, the Swiss government and the Association of Milk Producers (AMP), we have already launched three projects to support the agricultural sector. 
In September, a leading trade fair for livestock and renewable energy, EuroTier 2022, joined our initiative. We organized a partnership fundraising campaign. We are grateful that within the framework of this cooperation, the organizers of the exhibition will donate 1 euro from each ticket, which will go to the restoration of several agricultural producers affected by the war. We also hope to raise additional funds at the SAVE UA booth during the exhibition. 

So this year, by participating in the EuroTier as an exhibitor, and even just becoming a visitor, you can support the Ukrainian agricultural sector and help it accelerate its recovery. But we also encourage exhibitors and visitors to donate to support Ukrainian farmers for further productive partnership.