Ukraine loses competition due to poor grain logistics

Vasile Varvaroi, General Manager of the Danube region/Ukraine at Cargill
Vasile Varvaroi, General Manager of the Danube region/Ukraine at Cargill
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It is of great importance for Ukraine to create effective grain logistics, to improve grain supply chains from fields to ports. Inefficient logistics is the reason that Ukraine loses competition in the Black Sea Region.

This was stated by the General Manager of the Danube region/Ukraine at Cargill Vasile Varvaroi in the framework of the Grain Ukraine International Conference in Odessa.

"Today, we have 80% of grain transported by rail. It lacks efficiency, it is a backlog from which farmers, my team and the whole country suffer. Because of this, we lose the competition in the Black Sea Region," says Vasile Varvaroi.

Among the main problems of railway logistics, he named the absence of a transparent model of wagon cars distribution. The market participants cannot see how this process is organized and functioning.

Moreover, there are regions where farmers have no access to the railway.

According to the expert, Ukrzaliznytsya should give up preferential distribution of rolling stock.

"The market needs private locomotives. There are closed stations, and we need to work with Ukrzaliznytsya to open them," Vasile Varvaroi stressed.

He noted that the grey grain market is one of the key problems in Ukraine.

"Unfortunately, fair players suffer from it, and disreputable companies are the winners. The state needs to find ways to stop this by the law," he said.

The Deputy Minister Olga Trofimtseva informed that Ukraine exported most of its agricultural products, including grains, to the markets of Asia (42.6%), Europe (32.4%), Africa (14.6%) and others. Grains made up about 30% of all agricultural exports.

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