Agriculture

The agricultural union ‘Tsukrovyk Poltavshyny’, which is affiliated with the Astarta Holding [AST PW, BUY], finished 2009 with a net income of UAH 26.8 mln (USD 3.35 mln), which is a significant improvement. This compares to the net loss of UAH 86.4 mln that was declared in 2008. This positive dynamic has occurred despite a decrease in revenues from UAH 455.1 mln in 2008 to UAH 332.7 mln in 2009.

At their meeting on February 3, shareholders in the Palmira Sugar Mill, which is affiliated with the Ukrros sugar union [36U1 GR, UROS UZ], decided to redeem 9.39% of its statutory fund, or 1 043 487 ordinary shares from the Ukrros sugar union. The par value of one share is UAH 1.5 and the market value has not been determined, since the shares in the Mill were never listed on any exchange.

The Ukrainian Government has increased the minimum price for sugar in the 2010/2011 marketing year (September-August) by 63% to 5,100 UAH/tonne (including VAT), which is equivalent to 532 USD/tonne net VAT. This is up from the previously approved price of 3,125 UAH/tonne for the 2009/10 marketing year.

The Closed Joint Stock Company ‘Agricultural Enterprise Tsukrove’, which is affiliated with the Ukrros sugar union [36U1 GR, UROS UZ], intends to reorganize itself from a closed joint-stock company (CJSC) into a Limited Liability Company (LLC). This very question is included for consideraton on the agenda of the shareholders' meeting of the Agricultural Enterprise Tsukrove, which is scheduled for March 2, 2010.

The Ministry of Economy intends to simplify the procedure for obtaining licenses for the import of raw cane sugar. In particular, the Ministry proposes cancelling the requirement to present both the original and copy of the certificate of origin issued by the relevant authorities in the country of origin. It also proposes establishing a 60-day period of validity for licenses issued, in place of the currently applicable rule, whereby issued licenses are valid until December 31. The authors of these proposals believe that such a strict term should encourage importers to proceed quickly in transacting raw sugar imports

MHP S.A. [MHPC LI, HOLD], a leading Ukrainian poultry producer, provided its operational results update for 4Q2009 and the full year ended December 31, 2009

At their meeting on January 27, shareholders in the Orzhitsky Sugar Mill, which is affiliated with the ‘Ukrros’ sugar union [36U1 GR, UROS UZ], decided to reorganize the mill from a closed joint-stock company (CJSC) into a Limited Liability Company (LLC). As a result of this reorganization, the ‘Orzhitsky Sugar Mill’ LLCwill be a successor of all property, rights and responsibilities of the CJSC ‘Orzhitsky Sugar Mill’.

The Antimonopoly Committee of Ukraine (AMC) has filed a suit about the case of increasing prices for sugar on the domestic market. According to the Acting Committee Chairman Alexander Melnychenko, retail sugar prices in Ukraine have grown by 30% on average since the start of the year. Since such a significant price hike for sugar may involve a violation of antitrust legislation on the part of market participants, the Committee decided to file a suit.

Since the start of 2009/2010 marketing year (July 2009-June 2010) to January 26, grain exports from Ukraine totaled 14.96 mln tonnes. In 2008, exports stood at 13.82 mln tonnes for the same period. In particular, so far in the 2009/10MY, Ukraine has exported 7.29 mln tonnes of wheat, 4.1 mln tonnes of barley, and 3.4 mln tonnes of corn.

According to data provided by the Ministry of Agrarian Policy, as of December 3, 2009, lending to the agricultural sector in Ukraine in 2009 decreased 3.5 times YoY from a total of UAH 20.05 bln to just UAH 5.79 bln. The loan portfolio in Ukraine also doesn’t paint a rosy picture, with long-term loans accounting for an estimated 8.6 % of all loans. The interest rates paid by agricultural companies varied from 16% to 39%. As for loans that were attracted earlier, in 2009, only UAH 3.1 bln worth of loans were extended of the overall UAH 3.9 bln that required prolongation.