January 17 2007, 17:01

The profitability of vegetable production has significantly decreased in 2006

According to the evaluations of "Agrooglyad: Vegetables and Fruits" journal, vegetable production remained profitable in 2006; however, the profitability of most vegetable crops production significantly decreased comparing to 2005.

During the international conference "Fruits and Vegetables of Ukraine 2005" in the end of 2005 the analysts of the Agricultural Marketing Project warned the market players about the possibility of the rapid growth of vegetable production and the decrease of average prices. Time has passed, and we see that the forecast has been fully confirmed; the production growth of vegetables has exceeded the best expectations. As a result, the profitability of the production of cucumber, tomato, bell pepper, egg-plant, white cabbage, potato, carrot, table beet and bulb onion has significantly decreased.

According to the evaluations done by Andriy Yarmak, the Deputy Director of the Agricultural Marketing Project, cucumber producers have experienced the most abrupt decrease of the profits this season. The feasibility of tomato production in the open ground has decreased too; it especially concerns tomatoes for processing.

Talking about vegetables loaded to the storages, the prices for carrot and cabbage have declined the most dramatically. At the same time, the production cost of these crops still let the producers achieve a rather good profitability (30 to 100%) despite of the existing price level. At the same time, we should note the twofold decrease of the profitability per one hectare of carrot and cabbage this season.

The price for potato declined only 20-25% comparing to the previous year; despite of this fact, the feasibility of this crop production deteriorated more significantly due to great expenses to purchase seed material in spring 2006. Though, the analysts assess that potato production can increase in 2007.

The detailed forecast of fruit and vegetable production and prices in 2007 will be published in April issues of "Agrooglyad: Vegetables and Fruits" journal.