The combined financial losses inflicted on the Ukrainian agricultural sector since Russia’s invasion in February exceed €34bn, the country’s first deputy farm minister Taras Vysotskyi told attendees of a rural development conference on Thursday.

Farmers’ losses are being further exacerbated by wheat prices there, which are 50% of the global average, showing little sign of increasing due to high transport costs and heightened risks associated with buying Ukrainian grain.

“Destroyed storage facilities, damaged equipment, property stolen from occupied territories, everyone faced serious logistical and infrastructural challenges,” said Minister Vysotskyi.

“There are significant losses due to reduced crop and livestock production, but our farmers, realising that the food security of the world depends on them, are taking significant risks.”

Yields back

Last year saw Ukraine’s farmers harvesting a record 108m tonnes (Mt) of grains and oilseed. However, 13Mt of that harvest remains to be exported.

This year’s harvest is back to around 65Mt of grain and oilseed, with 2021’s stored harvest only “gradually returning to traditional markets”, according to the deputy minister.

The minister made a video contribution to the OECD’s rural development conference hosted in Cavan on Thursday, which was also addressed by deputy secretary-general of the OECD Yoshiki Takeuchi.

Price struggles

The average cost of transporting a tonne of Ukrainian cereals to the border has risen to €205/t and this cost is seeing Ukrainian grain growers receiving around €200/t for their wheat, said Takeuchi at the conference.

"That means domestic prices are much, much lower than international prices. They are even lower than previous years and that threatens the liquidity of farmers. They do not have enough to plant next year’s crops.

“We all see that the process of grain, wheat and corn have reached an all-time high. Wheat in the Middle East and Africa is worth more than $400/t (€412/t)."

The economist also stated that the slow pace of grain exports was increasing world prices.

“When Ukraine exports 50% less wheat, with all other things kept normal, it’s 9% higher, the global price of wheat. That means everyone will pay more for wheat when they cannot export.”

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