Ukraine’s Farm Sector Profitability Forecast by Agriculture Ministry – Sky Bulletin
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According to projections for the year 2024, the profitability of various crops in Ukraine is set for a positive shift. The Ministry of Agriculture predicts a rise in profits for grain and oilseed crops, contingent upon consistent security conditions and uninterrupted sea exports. The forecast also hinges on stability along Ukraine’s western frontiers. Despite these optimistic projections, a dip in yields by an estimated 4-5% is anticipated. These developments come amid increasing elevator service expenses, driven by higher electricity rates. Furthermore, a potential hike in land rental costs could be seen, with values rising by about 5% to $125 per hectare due to the introduction of the land market to corporations. Profits from wheat are expected to be on the lower end, while corn and barley may remain in the negative. Conversely, oilseed crops are set to see an upturn in profitability.
In contrast, the outlook for livestock profitability is less favorable, with anticipation of a decline in 2024. This predicament is due to the disproportionate rise in feed and electricity prices relative to those of livestock products. Despite the challenging environment, most livestock goods managed to remain profitable in 2023.
FAQ Section
What is the projected profitability for grain and oilseed crops in Ukraine for 2024?
Profitability for grain and oilseed crops is expected to increase in 2024, provided there is no escalation in security issues and exports through sea routes remain stable.
Is there an expected change in the cost of agricultural inputs?
Yes, there may be an increase in elevator service costs due to higher electricity rates, and land rental fees could possibly rise by about 5% to $125 per hectare.
Will all types of crops become profitable?
While oilseed crops are projected to be profitable, wheat might see lower profitability, and corn and barley could remain unprofitable.
What is the profitability outlook for the livestock sector in Ukraine?
The livestock sector is likely to experience a decrease in profitability due to rising costs for feed and electricity, which are expected to outpace the price increases for livestock products.
Did livestock products remain profitable in 2023?
Yes, most livestock products continued to be profitable throughout 2023.
Conclusion
The Ministry of Agriculture of Ukraine presents a mixed economic forecast for the agricultural sector in 2024. There is a positive trend projected for the profitability of grain and oilseed crops, subject to stable geopolitical and trade conditions. Yet, elevating operational costs and the potential for increased land rental fees suggest that certain cereals may face profitability challenges. Livestock, which remained profitable in 2023, could see a reversal due to growing input expenses, highlighting a more complex landscape for this industry. The agricultural sector will therefore require strategic responses to the evolving economic environment to maintain and enhance profitability in the upcoming year.
Please note that the content provided is reproduced with the original information adapted into a new format. TheUBJ is not the creator of this content; the source The Ministry of Agriculture of Ukraine assesses the profitability of the farm sector is acknowledged for information purposes.
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