September 4 2008, 15:07

CIS: increasing transport costs decrease profitability of vegetable production in traditional regions-producers

According to the information of the analysts of “Fruit-Inform” project, currently, many producers and customers leave in doubt specialization of vegetable production, which was actively developed in the recent years, due to increase of the costs for production transportation. Therefore, cultivation of tomatoes, onion, aubergine and even watermelons and melons becomes enough prospective even outside Kherson, Zaporozhye, Odessa and Nikolayev oblasts of Ukraine. This causes decrease in demand for products in traditional regions-producers, as a result prices misbalance increases more and more. This also negatively influences development prospects for shipments of fresh products from the southern regions of Russia located far away from the main centers of consumption.

At the same time, rise in costs for transport is very profitable for enterprises located directly in the production regions. To date, they can allow themselves procuring at more favorable prices, than their colleagues, situated at long distance. For example, in Ukraine, the prospects of effective work of canneries, located in the northern part of forest-steppe and forest climatic zones became substantially worse.

More detailed information about how rise in transport costs will influence development of situation in fruit and vegetable business of Ukraine and Russia in the nearest 12 months will be presented in the reports of the leading industry experts during the work of the largest in the CIS countries branch conferences: the Third International Conference “Fruit & Vegetable Business of Russia – 2008” and the Fifth International Conference “Vegetables and Fruits of Ukraine 2008”.