June 10 2004, 09:19 APK-Inform

Government opposes reduction of 17-pc export duty for sunseeds

Ukraine's Deputy Prime Minister for Agriculture Ivan Kyrylenko said in an interview June 9 he did not support the initiative about reduction of the 17 percent export duty for sunflower seeds.

One of the parliamentarians on June 1 submitted to Verkovna Rada a bill about cancellation of the currently effective export duty for sunseeds.

According to Kyrylenko, Ukraine's oilseed industry has been currently operating at a steady rate, the infrastructure of domestic oilseeds and products markets has been arranged to working in the conditions of existing duty and it is not worthwhile destructing this pattern.

Besides, an increase in purchasing prices for sunflower seeds, which might be caused by cancellation of the duty, will provoke a further expansion of sown areas under this crop, which will have a detrimental effect on the state of arable lands. Kyrylenko said the state agrarian policy in the nearest time would be encouraging an increase of sown areas under alternative oilseed crops, such as rape and soya, in order not to allow for expansion of the sunflower area.

Also on June 9 the First Deputy Agrarian Policy Minister Yuri Luzan told reporters the ministry would not be initiating any changes of the duty. He said there were now different proposals concerning this issue, with the initiatives favouring both reducing and increasing the duty up to its initial level, which had existed some years ago (24 percent). However, the ministry's specialists are of the opinion that the duty should not be less than 15 percent, as this level provides for normal functioning of domestic oilseeds market and, according to Mr. Luzan, "corresponds to the requirements of international organisations".