Giving Compass' Take:
- To recover its agricultural systems, Ukraine needs to prioritize local food system development, diversification of small and medium-sized agricultural enterprises, and a transparent agricultural land market.
- How can donors play a role in helping Ukraine with food system recovery efforts?
- Read more about the impact of the Ukraine crisis on food systems.
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The war started by Russia against Ukraine has left its mark on the country’s economy, particularly on agriculture. The disruption of supply chains and agricultural production has already caused significant damage to the people, the economy, and the environment of Ukraine. Despite these difficulties, the country faces the task of restoring the agriculture sector and making it sustainable.
Agricultural production is a key sector of Ukrainian exports. According to data for 2021, agricultural exports amounted to US$27.8 billion, which accounted for 41 percent of the total volume of exported goods. And the need to maintain production levels and secure supply chains for agricultural products has become a global challenge.
Ukraine is one of the leading global producers and exporters of agricultural products. It plays a crucial role in supplying oil crops and grains to the world market. In 2021/2022, the country produced more than 30 percent of the world’s sunflower and sunflower oil and over 27 percent of sunflower meal. The country ranks sixth in the world for production and third for exports of rapeseed (20 percent of world exports), fourth in production and third in exports of barley (17 percent of world exports), and sixth in production and fourth in exports of maize (12 percent of world exports).
But these indicators significantly changed during 2022. According to estimates by the KSE, the indirect losses of agriculture due to the war amount to US$34.25 billion. The direct losses are US$6.6 billion.
More than 84,000 units of equipment and machinery have been partially or completely destroyed, with an estimated value of US$2.9 billion. Grain storage facilities with a total capacity of 9.4 million tons were damaged or destroyed. The value of livestock resources lost by agricultural producers is approximately US$362 million. It is estimated that 5 million hectares of agricultural land (or 15 percent of arable land) in Ukraine are likely to be mined. According to the calculations of the All-Ukrainian Agrarian Council, it will take up to five years to restore some areas of the agricultural sector.
Based on the experience of war and other global challenges such as COVID-19 and climate change, it is clear that Ukraine’s post-war recovery must focus on developing resilient and decentralized agri-food systems. To achieve this goal, several priorities should be followed.
The first priority is the development of local food systems. The agri-food system is essential for ensuring Ukraine’s food and ecological security. Currently, the system is based on large-scale and monoculture production, centralized logistics and processing, making it vulnerable to aggressors and potentially causing systemic consequences for supply chains both in Ukraine and worldwide. Therefore, Ukraine’s post-war recovery should prioritize the development of more adaptive, sustainable, and decentralized agri-food systems.
Read the full article about Ukrainian agricultural systems by Vitalii Dankevych at Food Tank.