Financing is a critical point for middle-size farms in Ukraine

Source

APK-Inform

2410

Interview with Mukhin Maxim Valentinovich, Commercial Director of Agrofirma Slavutich (Ukraine)

- Would you give a short description of your farm?

Our company was established in 2002. When we started we had 1600 ha. We were purchasing all bases, the first one was in Bobrincy, there was a brigade and few warehouses, so called household. In 2006 we bought an elevator. Currently, we have about 40 units of machinery, 12 units of trucks,12 units of heavy tractors (T-150), 10 tractors of MTZ and other. Our elevator is also a seed factory built in 1986. It is about 150 tonnes of wheat with separate storing of each unit till 200 cubes. The total capacity of elevator's storing is 8.000 tonnes, and now we had joined more, so when we certify the thrashing-floor farms, there will be 20.000 tonnes. Also, we have another one thrashing-floor farm, and currently the total capacity of storing is about 35.000 tonnes.

- What is the total land bank of your farm?

Currently, the total land bank is 4100 ha. The lands are located as follows: there are 1900 ha in Bobrineckij region, and we also have about 1900 ha in Buhoveckij region Kirovograd oblast, and also we captured a little in Nikolayev oblast, but we have just only 300 ha there.

- Are you going to continue increasing the land bank in your farm?

Yes, we plan to increase the land bank up to 5.000-6.000 ha, but it will depend on the land market, first of all. I don't know in which oblast it will be, but we would like in Vinnitsa and Cherkassy.

- What crops are priority for you?

The top crops for us are sunseed, soybeans, wheat and barley.

- What winter and spring crops have you seeded this year?

This year, we have seeded 800 ha of winter rapeseeds, 1000 ha of winter wheat, 400 ha of barley, about 200-300 ha of soybeans, as well as sorghum, millet

- What reproduction seeds did you use while sowing wheat?

We have seeded 1000 ha of wheat, including 200 ha of super elite, and the rest is elite and first reproduction. In other crops, we mostly use first reproduction for tradeable crops, and for seeds we use super elite and elite. We have the accreditation of Elitsemhoz, and we are able to sell the elite seeds. Also, we have the powerful cleaning, sizling, drying.

- What varieties do you use for wheat producing?

We use the different varieties, but mostly zoned, because each zone has its own specifics. For example, the import seeds need the higher agricultural background, and also the sufficient content of moisture, and the zoned are more flexible, they are less fanciful to the forecrop, weather, fertilizers, quality of processing.

- What grains and oilseed are the most profitable in your opinion?

Wheat is the most profitable from grains, and rapeseed is the most profitable from oilseeds. First of all, it is the price, secondly - yield, even despite that fact it is difficult for production. Its profitability totaled 200% in our farm in the year before last. What about wheat, its profitability was less, about 110%.

- Will the profitability of agricultural business increase or decrease in the nearest years?

Of course, the profitability of agricultural business will increase in the nearest few years, because people are always hungry, and if you pack food correctly, people would pay for it as much, as you need. Basically, the profitability of agriculture will increase by 20% in the nearest time, at least, I would like it to be. I mentioned you the approximate average percent, and of course everything would depend on weather, yield and other.

- What mineral fertilizers and crop protecting agents do you use for wheat production, and for other crops in your farm?

Mostly, we use amofozka, nitrate, karbomit, folikery. Basically everything depends on the forecrop, for example, if the forecrop was soybeans, and then wheat is being seeded there, you may apply less volume of nitrogen fertilizers, because there was the nitrogen accumulation. If the forecrop was sunseed, you should apply much more of the nitrogen fertilizers, because the sunseed has pulled out almost all of them. If you seed on the fellow-land, there are mostly the phosphor fertilizers treated. But on average, if we apply amofoz while sowing (52% phosphor and 11% nitrogen for 120 kg of physical weight), then after seeding and wheat seedling we apply with fungicidal agents and herbicides. Then into the cryogenic soil we apply about 200-250 kg in physical weight of ammonium saltpeter, and before plants forming a step we apply about 120-150 kg in physical weight. Then we till with fungicides and herbicides, against the weeds and diseases, and make about 3-4 sprinkles with micro and macro fertilizers. Regarding fertilizers and plant protecting agents we predict the crop about 45-60 centner/ha, and then as the weather forms, because a lot of depend on it.

- What is the cost of mineral fertilizers this year? Did it increase compared to the last year?

The cost of mineral fertilizers has increased this year by 10-15% and totaled 2100-220 UAH/tonne of ammonium saltpeter. Annually, we spend about 2 millions and 1.5 millions UAH for fertilizers and plant protecting agent, respectively.

- What technologies do you apply in agriculture? What are their advantages and disadvantages?

We apply the following technologies: know-till, mini-till and subsoil tillage (subsurface cultivator). At null soil treatment, there are some difficulties with applying the herbicides and mineral fertilizers (it's very difficult to apply a lot of fertilizers at once), and get the regular sprouting when sowing. Regarding subsoil tillage, there is a problem with soil treatment during the dryness, because the machine may be on the fritz, but the same time we apply less of fertilizers and herbicides. As you can see we use the different technologies, each of them has its own advantages and disadvantages, so the optimal choice is to combine wisely few technologies, everything depends on agricolist. It is pointless to use just only one technology.

- What machinery do you use in wheat production?

For the soil treatment, we apply the heavy tractors, and those mostly are Kharkiv tractors T-150. In the presowing soil treatment, we apply the wheel tractors, and for sowing we apply just only tracked machinery.

- What machinery is the best for wheat production?

That depends on what machinery it is, if it's a light machinery, then we use MTZ. If the middle machinery, then it is John Deere, Case. But there are some difficulties with their servicing, there are some questions about their technical characteristics. It is necessary to hire specially trained engineer for work at the combines John Deere and Case, because there are too little specialists, who can work with this machinery.

- Are you planning to renew the machinery park this year?

Yes, each year we try to purchase something. This year we have bought three wheel-tractors T-150 and one tracked, two tractors MTZ-82, four trailers, Italian spraying machine, few beet-harvest combines. The machinery was mostly used.

- And what about repairing because the used machinery needs to be repaired rather often, how much are the annual costs for machinery's repair in your farm?

If to use the normal specialists and spare parts at the beginning, and then having a good technical service with good oils, we don't need so many times. The average costs are about 100.000 USD per year in our farm, but it is including the machinery park. About 280.000 USD of this sum is spent for spare-parts.

- What is the cost of regular technical service per year?

It os hard to say, because everything depends on the machine. For example, the costs for tractors like MTZ are about 400 UAH, T-150 - 800 UAH, the technical service of KAMAZ is also 800 UAH.

- Do you use crediting when purchase the machinery?

Yes, we do. Of course, it is still a big problem to take a credit, but this year we have taken 16% credit for 1,5 mln UAH. Now there are few tractors bought on credit in our farm.

- What is more important in agriculture, short-term or long-term crediting?

It is hard to say, both are very important. For example, for machinery's purchasing, more important is long-term crediting. Short-term crediting is necessary for purchasing plant protecting agents,mineral fertilizers, etc.

- Do you hire employers for season works and has the salary changed?

Sure, we hire, but number of employers decreases each year. We have stepped away from the hand soil treatment, and mostly, hire the combiners and builders. Concerning the staff, today their number is 76 persons. About the wages, it is at the last year level. Everyone has different salary, it depends on work type, for example, a man working with toxic chemical is able to earn 3.000 UAH, as well as 100 UAH a week.

- What is the cost of field-farm transportation?

At the moment of harvesting, the payment for field-farm transportation is 2 UAH/km

- Is there any government support for farmers?

Yes, there is, but of course, it is difficult to call it as support. For today, it is a zero rate of VAT.

- What are the nearest perspectives of your farm's development?

This year we plan to start sunseed crushing. First of all, to place the press-extruder, and also the oil-press for cold and hot extraction, in order to have two types, and to register own trade mark, in order to be able to sell sunoil as a product, but not as raw material. Also, we plan to build a mill and milling complex.

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