Why Potatoes in Ukraine Remain More Expensive than European Ones: Expert Explanation
In Ukraine, the current price of potatoes is nearly equal to the cost of production; however, in the long term, the price of this vegetable on the domestic market will always be higher than in European Union countries.
This is reported by AgroReview
Main Reasons for Price Differences
According to Andriy Marushchak, commercial director of the Dutch company Van Dijk Technics, the main factor influencing pricing policy is the lack of government support for Ukrainian farmers. While farmers in Poland or the Netherlands benefit from state subsidies, Ukrainian producers have to rely solely on their own resources. In Ukraine, there are no preferential loans or special conditions for the agricultural business, which complicates the competitiveness of domestic potatoes compared to European ones.
“In Poland or the Netherlands, farmers receive subsidies from the government – while our farmers have to work with their own money. After all, there are no preferential loans or any special conditions for our producers,” the expert explains.
Impact of Sown Areas, Harvest, and Imports on the Market
Marushchak also emphasizes that the significant drop in potato prices this season is related to a sharp increase in the area planted with this crop. Many farms doubled their plantings after last year’s high prices, hoping for a repeat of the profitable scenario. However, weather conditions provided an excellent harvest not only in Ukraine but also in many European countries, leading to an excess supply in the market and prices remaining low.
The expert predicts that this situation will persist for a few more months. However, starting from March-April next year, there will be a gradual increase in prices. During this period, potatoes will be massively imported into Ukraine from Poland, where producers do not have quality issues thanks to modern storage facilities. The availability of high-tech storage allows European farmers to keep potatoes until summer without losing their marketable appearance and sell them at favorable prices.
“By March, April, and May of next year, potato prices will start to rise again. Not significantly, but they will. At this time, potatoes will begin to be supplied to us from neighboring Poland, because there are no quality issues there. And why do they have no problems? They have quite a few high-quality storage facilities,” notes Marushchak.
Thus, the situation in the potato market in Ukraine directly depends on the lack of government support, structural features of cultivation, and the seasonality of supplies from other countries.