December 13 2011, 15:58 APK-Inform

Ukrainian banks sharply increase rates on loans to farmers

According to information received by Fruit-Inform, Ukrainian banks sharply increased rates on loans in hryvnia (UAH). Such an increase applied not only to new loans, but also to previously made loans and current credit lines, as banks always retain a right to do so.

Fruit-Inform clients report of rates on loans to have grown to 30-40% per annum. Financial analysts connect such a situation with Ukrainian banks' liquidity problems and expectations of hryvnia devaluation. In addition, in some cases, banks refuse to provide any loans pleading lack of money.

“Problems in banking sector may have a serious negative impact on the Ukrainian fruit and vegetable market which currently is in difficult times due to extremely low prices for traditional vegetables and potatoes”, Tetiana Getman, Head of Fruit-Inform, says. “In spring 2012, having already incurred losses this year, many vegetable and potato growers will not be able to start their planting campaign in case of no access to loans that threatens a shortage of vegetables and potatoes in the next season”, the expert continues.

In addition, as a result of changes in the banking sector, investment projects on expansion of modern fruit and vegetable storage, post-harvest handling and processing facilities were put at risk of failure.

More detailed information about this factor's impact on the Ukrainian vegetable and potato business in the next season will be presented at the Fourth International Conference “Potatoes and Vegetables of Ukraine – 2012”, Kiev, Ukraine, February 16, 2012.