Information for fruit and vegetables business in CIS
Import Tax Decrease Has Had an Effect on Apples and Prices Drop
A new import tax on apples came into effect on December 1st according to the updated Custom Tariff. Two weeks had passed and the price on apples remained stable, in fact, prices on some apple varieties even increased slightly. This fact surprised experts. However, the situation is changing today, so we can say the previous forecasts were warranted.
It's widely known that Polish producers and companies were among the first who were interested in supplying apples to the Ukrainian market. After the decrease in the customs tariff, many were not immediately ready to import apples. Companies needed more time to prepare necessary documentation and to find Ukrainian partners, as well as solve other problems. In addition, Ukrainian import companies had to sell remaining inventories of previously imported products. These problems seem to be resolved now and Polish apples are starting to be actively supplied to the Ukrainian market.
According to information provided by Anatoly Yarovoy, Wholesale Price Monitoring Specialist of the Agricultural Marketing Project, today at the Farmer market (Troyeschina, Kyiv) apples of the Simirenko variety decreased in price from $ 1.76/kg to $ 1.37/kg; Mitsu variety apples declined from $ 1.56 to $ 1.10/kg, and Ligold apples were seen dropping from $1.27-1.37/kg to $1.10/kg. Apples from the medium price segment became cheaper, too and the price of quality Golden Delicious apples decreased by 20% down to $0.78/kg. The price decrease is definitely caused by the increase in Polish supplied apples.
The updated Custom Tariff of Ukraine was created in August 2005. One of the most disputed provisions was the decrease of import tax on apples from EUR 0.5/kg to 5% of the declared cost effective for the winter period. This means the tax was actually decreased approximately 90-95%. Experts forecast this provision will significantly lower the attractiveness of apple production in Ukraine. Producers of expensive table apples will suffer the most. Before this provision came into force, national orchardists were almost sure to obtain good profits and to rapidly develop this sector for another couple of years.