Information for fruit and vegetables business in CIS
How to survive on market in the conditions of fruit and vegetable overproduction? Odesa responded - cooperation
Odesa oblast is a unique one from the point of associations uniting the agricultural producers. Some years ago the cooperatives were actively created in the region; then associations came in fashion. This year the cooperatives became popular again.
According to the opinion of Raisa Volik, Specialist of Association/Cooperative Development of Agricultural Marketing Project (AMP), this is not a shift of fashion; it is the necessity of time. For the recent years farmers have mastered the most modern technologies of agricultural commodity production; it resulted in overproduction and price decrease on fruits and vegetables. Now prices are often dictated by the consumers - processing enterprises, wholesale companies, etc. In this situation the questions - how to protect oneself on market and where to supply the produced commodities - become extremely topical.
Trying to find answers on these questions, farmers understood that only due to the cooperatives the large wholesale supplies can be formed; plans of the production of the commodity assortment can be coordinate; and the efforts on storing and packing of the commodities can be also united. All these factors let them have stronger position on market during the negotiations with the potential buyers.
To our regret, the government of Ukraine has not reacted yet to the numerous requests of agricultural producers to solve the problem of double taxation for the agricultural cooperatives that in fact blocks up the cooperative development in the country. The existing legislation practically disqualifies farmers to work together on a legal basis, however in the majority of world countries the high efficiency of agricultural cooperation and its positive influence on the agricultural markets development were proved long time ago. Still many Ukrainian farmers decided to unite right now, often into simple informal groups, which de-facto function as traditional agricultural cooperatives.
On the basis of "Favorit" cooperative (village Starokozachye, Belgorod-Dnestrovskiy rayon, Odesa oblast) which is one of the most successful cooperatives in the oblast, to the opinion of Raisa Volik, on the 18th of November, 2004, AMP training on cooperation was conducted. The members of "Favorit" cooperative, the farmers from the neighboring villages, members of the public organization "Bereginya" from Nikolayevka, and the private entrepreneurs of Tatatrbunar rayon - mushroom producers participated in the event. The positive experience of the really functioning cooperative was, perhaps, maybe more eloquent than all appeals pro cooperation of the best experts of Ukraine.
Next day the alike training was conducted in Izmail. The South of Odesa oblast was selected for the second training not by chance - there are lots of active farmers there which have been working in the communities for some years already, formed as associations, credit unions and cooperatives. Each form of cooperation has its advantages and disadvantages and each, no doubt, has the right to exist. The representatives of all forms of communities participated in AMP training, and also discussed the questions of management and marketing within the organizations.
The vivid interest was aroused by Fedor Rybalko's presentation "The Investment Attractiveness of Fruit and Vegetable Production in Different Regions of Ukraine". Basing on the full analysis of vegetable, fruit and berries production and demand in Ukraine since 1990 till now, Fedir Rybalko showed quite obviously how to define the kinds of the commodities which can meet demand on market at the present moment. The report of Oleg Stoyanov, Credit Specialist of Odesa AMP office, was also very interesting. Farmers wanted to know the new opportunities concerning easier approach to credits available thanks to AMP cooperation with bank "Nadra" and other commercial banks of Ukraine.
The result of such trainings, to the opinion of AMP specialists, will be the high efficiency of farmers' work thanks to united efforts and their joint cooperation, first of all, in the issues of commodity sales.