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29 March 2024

News

26.10.2012

Freight car deficit may stop grain production development in Ukraine

Freight car deficit for transportation of grain and oil-bearing crops may become the limiting factor for further increase in production of grains and oilseeds in Ukraine. This was stated by the Association "Ukrainian Agribusiness Club" (UCAB).

UCAB reported that during the last weeks the information about the failure to provide freight cars comes not only from trading companies but directly from grain producers, even in case of timely applications for freight cars provision. Experts point out that the main problems are the lack of financing for new freight cars purchase by Ukrainian Railways, lack of economic conditions for the purchase of cars by shippers and provision of rolling stock for transportation of transit grain that significantly increases the period of circulation of cars.

UCAB states that the further expansion of grain production will be under question if the abovementioned problem will not be solved in the nearest future. "Why to increase the grain production, if you cannot ship it according to the concluded agreements and receive funds for further operational activity," - Alex Lissitsa – the President of UCAB said.
 
The problem is becoming increasingly important in view of the fact that the grain production gradually moves into the central and northern regions. "Climate change and focus on corn production led to the fact that the main volume of grain is produced not in  the Southern and Western Ukraine but in the Central Ukraine and the shipments of grain by trucks from these regions appear to be economically and logistically impractical" - added Volodymyr Lapa - Director General of UCAB. According to him, about 10-11 thousand grain-carriers operate now, but taking into account the future needs the number should be 15-16 thousand. Until recently the shipments increased at the expense of reduction of circulation of freight cars, but the possibilities for further optimization are limited.

In this respect, UCAB addressed the Cabinet of Ministers of Ukraine to assist to solve the current issue.

Association "Ukrainian Agribusiness Club" 
Velyka Zhytomyrska str., 20 А, office 53, Kyiv, 01001
Phone: +380 44 201-4950
Fax: +380 44 201-4951
099 272 59 30
Tetiana Kotyk
www.agribusiness.kiev.ua

The Association "Ukrainian Agribusiness Club" (UCAB) www.agribusiness.kiev.ua was founded in 2007 to protect the economic and professional interests of players of agribusiness in Ukraine. UCAB is a unique platform in Ukraine for establishing business contacts between the leaders of agribusiness, improvement their work and dialogue with the government. UCAB actively supports Ukrainian producers in establishing and maintaining international business relations. The Association consists of the largest producers and processors of agricultural products in Ukraine.

 

 




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