EBRD will increase its financing of the Ukrainian agriculture sector in 2016

This article discusses plans of EBRD to invest more in the Ukrainian agriculture sector, its cooperation with the main agriculture companies in Ukraine and also provides information on some other recent developments in agriculture.

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EBRD announced that it would increase its financing of Ukrainian agriculture sector in 2016 for up to EUR 200 million. In 2015 EBRD provided lending in the amount of EUR 175 million, which is less than in 2014 (approximately EUR 250 million), but still considerably more than financing of other industries.

The representative of EBRD announced that the bank had implemented all its projects in Ukraine in2015 and continued its cooperation with the largest players in Ukrainian agriculture, namely Nibulon, Kernel and MHP. EBRD also expects completion of the revolving loan agreement in the amount of USD 20 million with Ukrainian Agrarian Investments within the next few weeks.

In addition, the Ministry of Agrarian Policy and Food of Ukraine announced that following the beginning of a market year, Ukraine had already exported 24 million tons of crops. According to the report, as of 26 January 2016, Ukraine exported 10.9 million tons of wheat, 8.95 million tons of corn, 3.93 million tons of barley and 144,000 tons of other cereals. The Ministry of Agrarian Policy and Food of Ukraine expects that the export volumes of crops will amount to almost 37 million tons in 2015-2016 market year.

At the same time, Ukrlandfarming, one of the leading agriculture companies in Ukraine, declared losses in the amount of USD 164.50 million due to its poor economic performance in January-September 2015. The revenue of the agricultural holding declined by 38% in comparison with the same period in 2014 and constituted USD 716 million.

Among other developments, the co-owner of Mayer Delfs, a German company that has a subsidiary doing agriculture business in Ukraine, stated that resignation of the current Minister of Agrarian Policy and Food of Ukraine would have a negative effect on the investment climate in the Ukrainian agriculture sector. We note that the current Minister of Agrarian Policy and Food of Ukraine might resign due to tensions within the political party that delegated him to the Government of Ukraine.

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