February 8 2011, 15:10 Fruit-Inform

Cabbages are the most profitable product of the season 2010/11 in Ukraine and Russia

According to information of Fruit-Inform Project's analysts, cabbages having the lowest production costs among borsch vegetables (cabbages, onions, carrots, beets) are the most expensive product among traditional vegetables and potatoes in the markets of Ukraine and Russia.

As of today, Russian farmers get EUR 0.64 per kilogram of cabbages sold; Ukrainian farmers sell their produce at EUR 0.51/kg in the domestic market. Such prices enable producers disposing of cabbages to get high profits from cabbage sales.

However, according to Andriy Yarmak, head of Fruit-Inform Project, cabbage growing can not be considered highly-profitable business in CIS. “Cabbages are the most risky product among all traditional fruits and vegetables as cabbage prices can grow or fall dozens times from year to year. So there are no farmers specializing only in cabbage production in both Ukraine and Russia. One year this produce can have a profitability of 500%; other year it can not be sold at all, and producers lose almost all funds invested in cabbage production”, A. Yarmak tells.

“Therefore investment projects on cabbage growing should be considered according to at least 5-10-year prospects and only in the aggregate with other vegetables. Such projects require rather solid investments in machinery, warehouse and post-harvest handling equipment, and give average profitability reaching 35-45% if production and distribution are organized in proper way”, A. Yarmak continues.

Experts of Fruit-Inform Project warn farmers against too sharp increase of areas under cabbages in 2011 notwithstanding high profits from cabbage sales in the current season. However, if clients of Fruit-Inform Project are well informed and therefore armed, then, on the other side, in such profitable years it is rather difficult to warn farmers coming to cabbage production from other sectors of agriculture business or even other economic sectors.

More detailed information about economics and specificity of borsch vegetable (onion, cabbage, beet, carrot) and potato growing, storage, and post-harvest handling technologies will be presented during the third international conference “Potato and Vegetables of Ukraine-2011” already in two weeks.

This event is to take place at Shuvar wholesale market, Lvov, Ukraine, February 24-25, 2011. On-line registration is available through this link.