The agricultural sector in Ukraine has been a very important source of GDP for Ukraine since Soviet times. These days Ukraine possesses about 35 million hectares of arable land, which is about 30 % of what the EU countries have in total, and 22 % of what the U.S. has. Additionally, Ukraine´s climate is favorable for growing crops and much of the arable land is classified as very fertile black soil. The agribusiness sector has shown over 20 % annual growth rates per year over the past 10 years, and produces over 10 % of Ukraine´s GDP.
The agricultural sector is expected to grow and maintain its importance in the future too. Recently Ukraine has signed cooperation agreements with China, in an effort to significantly boost its grain exports to China. There are plans to establish a Sino-Ukrainian Council for agricultural cooperation. Especially high output rates for grain, sunflower oils, and soybeans are expected this year due to early rainfall. The global prices for food have risen sharply after the start of the Covid-19 pandemic, which will contribute to growth in Ukraine´s agricultural sector.
There are several opportunities to invest in Ukraine´s agribusiness sector. Capital investments are needed in grain storage, logistics, and irrigation. Western smart farming technologies could be used to improve efficiency in the sector. Data analytics and ag-tech are currently not utilized very well in Ukraine.
Currently, the Ukrainian law does not allow foreign investors to purchase agricultural land. Use of agricultural land by foreign investors is limited to leasing arrangements. If you are interested in investing in the Ukrainian agribusiness sector or opening a company in Ukraine, contact us for more details.
More sources for information:
https://magazine.wharton.upenn.edu/digital/hot-investment-agribusiness-in-ukraine/
https://agribusinessinukraine.com/the-infographics-report-ukrainian-agribusiness-2019-eng/
