Agricultural of Ukraine

Agricultural sector of Ukraine makes up about 10% of GDP of the country and provides the population with food at the level of 95% that is one of the highest rates in the world. Besides, the agricultural products market of Ukraine has a vast potential to increase in the absolute numbers and great possibilities to substitute many import positions. Due to UNO data Ukraine closes the set of three world leaders as for the dynamics in agricultural production (after Brazil and Russia).

For the last 4-5 years the investment attractiveness of the agricultural sector of Ukraine grew in times. Due to the results of the "crisis" of 2009 agriculture of Ukraine was the only economic sector which showed the growth of the production volumes (+0.1%).  In 2008 the capital investments to the sector achieved the record sum in 3.2 bln USD (7.2% from the total volume of investments). In 2010-2011 we can observe an activation of the players in this particular sector that can be explained by the existence of a great potential, and also by the absence of the sector overheating because of the speculators.  In addition, the agriculture is a part of “protected” sectors – sectors that are the most resistant to world economic fluctuations.

Current tendencies of the development of the agricultural sector of Ukraine:

• Excess profits from new modernized companies comparing with the enterprises of “old formation”
• Consolidation of different agricultural directions in one huge holding company (vertical integration)
• Increased interest from the side of portfolio and strategic investors
• Entrance to the international markets (IPO, Private Placement). In 2006-2010 huge Ukrainian companies (agricultural and industrial holdings “Myronivsky Hliboproduct”, “Kernel”, “Astarta”, “Mriya Agro Holding”, “Agroton”, “Milkiland”, “Dakor”, “KGS Agro”, “Industrial milk company”, “Agroleague”, “Avangard Agroholding”  and others)  successfully placed their shares on western and Ukrainian exchanges.   The main exchanges for IPO, SPO and PP of Ukrainian companies are London, Warsaw and Frankfurt stock exchanges.
• 2-3 times price increase of agricultural products in Ukraine during 2010-2011
• as a result – considerable increase of attractiveness of the agricultural business in Ukraine.