Construction of storage facilities is a very profitable investment while the price for vegetables is so high in Ukraine

Published 2023년 6월 8일

Tridge summary

The article explores the economic benefits of investing in professional vegetable storages in Ukraine, especially during periods of high vegetable prices. It calculates that such an investment could break even or generate a profit within a year, given the current market conditions. The article also emphasizes the role of storage in enabling farmers to plan their business and control the selling process, which is crucial for meeting long-term supply contracts. It also touches on the challenges of vegetable production and sales in Ukraine, such as the lack of a systematic approach, low market transparency, and the need for contract farming to stabilize the market. The article also mentions that while Ukrainian processors have successfully established long-term contracts with farmers for specific potato varieties, wider adoption of such contracts is limited due to retailers' resistance and farmers' reluctance to commit to fixed prices.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

Do the high prices of vegetables make the construction of professional vegetable storages a profitable capital investment? Of course! First, it is a necessity. Also in the period of high prices for vegetables, the construction of vegetable storage is a very profitable capital investment. Previously, it was believed that the payback period of storage, for example, for 10,000 tons, at the price before full-scale invasion, is approximately 4-5 years. However, today the same storage can pay for itself even in a year. That is, those farmers who built storage facilities two years ago, planted vegetables in season 2022 and kept them till 2023 can now successfully sell their produce for very good price and return their capital investment. The storage allows farmers to plan their business processes and cooperation with the buyers – they do not need to sell the vegetables from the field and can wait for better price or higher demand. Storage is a need when the farmers have long-term supply ...

Source: Agroberichtenbuitenland