Tuesday, 26 April 2011

What is the potential output for Ukraine?

There is much discussion about the agricultural potential for Ukraine but what is the reality behind the hype?

Premier Mykola Azarov told Inger Anderson, Vice President of the World Bank that “Ukraine can potentially grow over 100mn MT of grain.”

Is 100mn MT of grain technically possible in Ukraine?

Firstly you need to define what you mean by “grain.”

State statistics include maize (corn) and soya to come up with the all-encompassing and rather unhelpful category of “grains and leguminous crops.”

So when Premier Azarov states that Ukraine can produce 100mn MT of grain let’s assume he means “grains and leguminous crops.”

The average area of these crops grown over the last 20 years is 14.4 million hectares out of an average total cropped area of 27.7 million hectares.

There is 42 million hectares of arable land in Ukraine although I suspect some of this will be low potential.

To achieve an output of 100mn MT of grain would require a 52% increase in grain cropped land area and 77% increase in yield.

Increasing the cropped land area by 52% requires investment and a stable business environment and is therefore technically if not politically possible.

Is a 77% increase in yield likely?

As a scientist I would say yes, it is possible with targeted investment in appropriate seed, fertiliser, sprays, equipment and staffing.

But given the reality of the situation on the ground I would say it is a highly unlikely.

Everything needs to be fixed starting with the land, subsoil, soil fertility and pH; weeds, grass and perennial weeds; cultivation and planting equipment; fertiliser spreaders, fertiliser, pesticides and crop sprayers; staffing, staff training, environmental management and record keeping; harvesting logistics, security and storage. I could go on but I think you get the picture.

What is the potential for Ukrainian agriculture?

Realistically? A lot less than many will have you believe.