Local nitrogen fertilizers producers make money in Ukrainian market and get high margin, but importers can’t prevent that. The UAC Deputy Chairman Mykhailo Sokolov mentioned this information during the open public discussion about fertilizers import quotation. The participants include authorities, businessmen and experts.“

"There is no danger for the local producers. Now we see, that prices, which account for 80% of the cost of fertilizers, are lower in Ukraine than in the countries with which we compete in Europe. Moreover, you should understand that the delivery of fertilizers from the other countries requires to pay for logistics. That is why we have prices on the market that have been established. Besides, local producers import fertilizers to other countries for lower price. So, they get very high monopoly margin on the local market (they can’t get the same money on the international market). Therefore, we can’t affirm that there is a danger for their business processes.” – Mykhailo Sokolov mentions

Moreover, statistics of 2019 show that the production of nitrogen fertilizers in Ukraine increased by 70%, which may not indicate of any threat to the producer. At the same time, quotation import introduction for mineral fertilizers will contribute to the final monopolization of the market and raise already inflated prices of domestic producers. This follows directly from the previous conclusions of the Ministry of Economic Development, Trade and Agriculture of Ukraine.

"If we look at the conclusions which were made by the Ministry of Economic Development, Trade and Agriculture of Ukraine, it directly states that the problem we want to solve by introducing quotas - is low fertilizers prices. So, the prices that we have now are already higher than the world’s one, the investigation calls low. And that is the problem that is proposed to be solved. So, maintaining quotas will lead to a further prices increase." – the UAC Deputy Chairman says.

According to Mykhailo Sokolov, if a domestic producer aims to be the first in the fertilizer market in Ukraine, he just needs to make domestic prices the same as export prices are, it means to make them lower. Thus, the import of basic mineral fertilizers to Ukraine will become impossible and no measures will be required. You just need to stop earning a premium margin on the Ukrainian agricultural producer.

Let’s recount, that at the end of May 2020, we get to know that the Ministry of Economic Development, Trade and Agriculture of Ukraine decided to introduce quotas for nitrogen fertilizers import to Ukraine. We are talking about import from partner countries – EU countries, Arabian Gulf countries, North Africa countries, also from Turkey, Kazakhstan, Byelorussia, Georgia, China, USA. This decision made a wave of excitation among farmers, who made two protest campaigns against such a decision. Farmers gathered at the main autobahns, and then – at the Presidents’ Office and Verkhovna Rada of Ukraine. Farmers declare that quotas introduction will make market monopolization by the company group “OstChem” (the owner is Dmytro Firtash), who unites the main fertilizers factories, and make fertilizers more expensive.