Agricultural Exports Revenue (2022) Declines for Ukraine Amidst Ongoing War

Kyiv: According to the market expert, the continuous Russian invasion of Ukraine would result in a 15.5% decline in agricultural export revenue this year, to $24 billion. According to the Ukrainian Agribusiness Club, the first few months of the invasion saw a substantial decline in the exports of Ukrainian grain, which had an impact on the total year's export results.

The country's agricultural exports have recently been progressively rebounding since the Black Sea grain export agreement, which cleared the supply of food through Ukrainian seaports, went into force on August 1. The top exports of agricultural goods from Ukraine in 2022 included corn, sunflower oil, wheat, rapeseed, and sunflower seeds. The agriculture sector incurred direct losses from the war of $7 billion, according to Ukraine's Economy Ministry earlier this month.

Losses in the occupied territories and areas where there are current military actions have reduced Ukraine's agricultural productivity. The population's income has been reduced because of the closure of numerous firms. The imbalance between the supply of goods and the decline in demand is the result. Large producers may and are attempting to increase exports to address this issue, while small and medium-sized businesses have challenges because they are more difficult to turn to exports and/or raise pricing for. Additionally, access to product sales channels like major grocery chains is extremely restricted for small and medium-sized businesses. The decrease in the nation's ability to generate money has been supported by the aforementioned factor.

Russia started launching frequent, powerful missile assaults on vital civilian infrastructure in October. More than half of Ukraine's electricity infrastructure has been destroyed, severely damaging the nation's agricultural output, including wheat, sunflower, and other grains, as well as edible oils, in the domestic market of Ukraine.

According to the ChemAnalyst database, the agricultural revenue of Ukraine is likely to decrease because the specified amount covers losses due to logistical disruptions and a decrease in prices for export-oriented goods, as well as a decrease in the production of agricultural crops, animal husbandry products, and other goods, as well as an increase in production costs and a decrease in the production of perennial crops, all of which directly affect the revenue of the nation.