During a recent economic review hosted by the Centre for Economic Strategy (CES), Oleh Khomenko, the CEO of the Ukrainian Agribusiness Club (UCAB), presented a detailed assessment of the challenges currently confronting Ukraine’s vital agricultural sector. Khomenko’s address highlighted the immense strain on farmers and agribusinesses, arguing that the combination of geopolitical instability, heightened energy prices, and punitive taxation structures has jeopardized the sector’s ability to operate efficiently and sustainably. The core of his proposal revolves around three major policy recommendations, all aimed at providing immediate financial relief and structural support to the agricultural market.
Firstly, Khomenko advocated for a substantial reduction in the excise taxes applied to fuels. Given that agricultural machinery and transport rely heavily on petroleum products, the escalating cost of diesel and other fuels significantly adds to the operational overhead for farmers. A tax reduction, he argues, would directly lower input costs, allowing producers to maintain profitability amidst volatile global markets.
Secondly, the CEO stressed the urgent need to abolish the existing import duties placed on fertilizers. Fertilizers are absolutely paramount inputs for modern agriculture, essential for maintaining crop yields and ensuring food security. High import duties on these vital resources inflate their cost for local producers, potentially leading to reduced planting areas or lower quality crops. Eliminating these duties would instantly lower the barrier to necessary farm inputs, thereby bolstering cultivation capacity.
Finally, perhaps most critically, Khomenko demanded a moratorium on any proposed increases in railway tariffs. Transportation costs are a major determinant of the final price of agricultural goods. If the cost of moving harvested crops from the farms to ports or processing centers continues to rise rapidly due to increasing railway tariffs, it drastically eats into the profit margins of the entire supply chain, putting immense pressure on market stability and the overall economic health of the dedicated farming community.
In summary, UCAB views these three interconnected policy adjustments—fuel tax cuts, fertilizer duty removal, and tariff freezes—not as discretionary economic reliefs, but as indispensable measures required for the fundamental survival and recovery of Ukraine’s agricultural engine. The sector, a backbone of the nation’s economy, cannot withstand further fiscal pressure without decisive governmental action.