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How the war is changing agriculture in Ukraine
In the Donetsk region and parts of Mykolaiv, Zaporozhye, Kharkiv and Dnepropetrovsk regions, fighting is bringing agriculture back to feudal times. Before the war, supermarkets sold vegetables cheaper than market sellers. Like in many other countries, the supermarkets bought goods in large quantities. This made it possible to get a great discount. As a result, retail prices in supermarkets were cheaper than in the market. At least this was the case until the war broke out in Ukraine. But in the contested parts of the country, the supermarkets are now closed because it is dangerous for large stores to keep open when military activities are raging close by. All too many shopping centres have become victims of attacks.
This is why in the Donetsk region, there is no professional vegetable and fruit trade via intermediaries in parts of Mykolaiv, Zaporozhye, Kharkiv and Dnepropetrovsk regions. As a result, there is no tropical fruit. Bananas, oranges, coconuts, tangerines and mangos are hardly ever on sale.
Neither are any vegetables or fruit available at the smaller groceries which still exist in the towns, for this does not pay its way for the grocers. They are unable to buy larger quantities of goods, and transporting only small amounts is unprofitable because fuel prices have more than doubled.
Additional income with fruit and greens
This is why in war zones such as the Donetsk regionand parts of Mykolaiv, Zaporozhye, Kharkiv and Dnepropetrovsk regions, vegetables and fruits represent a sort of liquid currency. For wherever logistics has collapsed, there is a paucity of goods. Therefore, at least in the summer months, greens and fruit growing in districts offer locals a great opportunity to earn additional income. A lot of apricots, cherries, plums, apples and nuts grow along the roads and in the forests. Garlic, dill, raspberries, and blackberries thrive in abandoned dachas or gardens of abandoned houses. The dachas and gardens have been left behind by people who were evacuated. So those who have stayed grow vegetables and fruits in their gardens or harvest fruits from land that has no owner any more. They then either sell yields or eat them themselves. Many people have also started to grow greens and fruit on fallow land.
The cost of fruit and vegetables is two to three times lower than that of meat, sausages and other highly processed food. Since there is a lack of employment and money, many people can no longer afford expensive meat and sausages. This is why almost two thirds of grocers sell vegetables and fruit on the Kramatorsk market, for that is what people can afford. Kramatorsk is the administrative centre of the Donetsk region in Ukraine. The Russian army is 20 km away from the city. The city suffers daily air raids as well as rocket and artillery shelling.
Anyone who has produced a surplus goes to the market, where he or she hopes to make a good deal. Such trading is reminiscent of former times. Trading takes place on the pavement, with an ordinary cardboard box serving as a counter. The prices of goods depend on the type of retailer and the situation. One and the same commodity may cost up to four times as much as it does elsewhere, as is the case with garlic. This summer, its price has ranged from 0.83 USD to 3.61 USD. In spite of these differences in prices, they are rarely a cause of disputes. The war is bringing people together and making them friendlier.
Rich speculators have left the market
Thus the war has eliminated everything that is ‘superfluous’ in the trade chains, and only essential commodities have remained in them. Paradoxically, poor local peasants and farmers have survived in difficult conditions, while the rich speculators have disappeared from the market.
The further one gets away from the fighting, the better the logistics and sales markets for fruit and vegetables become. However, things won't be like they were before the war. Kherson region which has been captured by the Russians, lies in the South of Ukraine, where most of the vegetables and fruits are grown. This is why, especially at the beginning of the summer, even in the regions where there was no fighting, early vegetables, which were above all grown in the Kherson region, were hard to come by.
Owing to the war and the economic problems, both prices and the share of imported products rose. In some retail chains, the share of imported products is at almost 50 per cent. In 2021, 453 thousand hectares was planted with vegetables such as eggplants, tomatoes or gherkins. The overall vegetable harvest in Ukraine amounted to 9.42 million tonnes, with 86 per cent of vegetables produced by farmers. The rest was grown by village inhabitants in their gardens. Nearly all of this is cultivated in fields, with just 0.4 million tonnes coming from greenhouses. However, this year’s harvest will be significantly smaller. Owing to the war, one can for example reckon with the eggplant yield dropping by 71 per cent, tomato yields by 68 per cent and paprika yields by 58 per cent. Each year, Ukrainians eat 7.2 million tonnes of vegetables, although in 2022, overall demand will be lower because 5.1 million Ukrainians have left their country. Perhaps this factor will somewhat balance the smaller harvests. In the current situation, the fruit and vegetable market is fully at the mercy of the war in Ukraine. The situation can change from day to day, depending on where fighting happens to break out.
Ukrainian wheat exports resumed
The war will also lead to a smaller wheat harvest in 2022, for it has not been possible to cultivate the fields to the same degree as that before the war. Wheat production in Ukraine is almost five times the volume of consumption. For example, last year Ukraine harvested 32 million tonnes of wheat. At the same time, the country's domestic demand did not exceed seven million tons.
Therefore, Ukraine is among the five top wheat exporters. Ukraine provides about ten per cent of world wheat exports. Egypt and Indonesia are the biggest buyers of Ukrainian wheat. In recent years, these countries have accounted for 15-16 per cent of all Ukrainian wheat exports.
In 2022, about 19.5 million tonnes of wheat will be harvested. This is almost 41 per cent less than last year. Then the harvest was 33 million tonnes. As a result, the volume of exports may decrease by almost half. The 18.8 million metric tonnes of wheat that Ukraine exported over the past 12 months is set to decline to around 10 million over the next 12 months.
When the war began, it was not known how much wheat Ukraine would grow and export. This uncertainty caused prices to skyrocket. At the beginning of the year, the average cost of grain in the world was $7.70 per bushel. In February, when the war began, the price increased to $13 per bushel. Until mid-June, the price was over $10 per bushel. However, it then began to decline. In early August, the average price of wheat was $8 per bushel. This is almost equal to the price at the beginning of the year before the start of the war.
With the resumption of Ukrainian grain exports, prices have now dropped again. Negotiations in the summer resulted in an export agreement between Ukraine and Russia. In addition, at the moment, the reduction in the production and export of Ukrainian grain can be made up for by other countries. But it is still too early to say how things will move on. The cost of grain may rise again due to rising fuel and fertiliser prices, as well as climate change. An increase in the area under crops can restrain the rise in grain prices. Farmers must learn to work in the new conditions, when fuel and fertilisers become more expensive. Whether farmers in various countries will be able to do this is not known. This is a challenge affecting everyone.
Pavlo Kuliuk is a Ukrainian freelance journalist from Donetsk region, Ukraine.