Derek Byerlee, distinguished agricultural economist and lead author of the World Bank’s 2008 World Development Report, will talk as invited speaker at the conference “Doing Agribusiness in Ukraine: Perspectives for 2011” organized by the Association “Ukrainian Agribusiness Club” (UCAB) on December 9.

According to Byerlee, with rising commodity prices, large-scale corporate farming is increasing rapidly in countries of Latin America, Africa and Eastern Europe with large amounts of land. «For example, in Argentina, the 30 largest companies manage about 2.5 million ha and in Ukraine, the 40 largest agricultural companies control about 4.5 million hectares of farmland. These companies have better access to finance, infrastructure and technologies and, therefore, they were in a better position than smaller farms to overcome the financial crisis. However, commercial family-based farming has been highly competitive in world markets even without subsidies in countries such as Australia and Thailand», the expert said.

As mentioned by Byerlee, Latin America and Eastern Europe have responded strongly to better prices by increasing both sown area (in Latin America) and yields since the 1990s. Nevertheless, there still exist significant potential to improve efficiency of agribusiness-based farming, especially in Eastern Europe. «Despite record grain harvests Ukraine experienced in the last few years, the country still has significant reserves to increase productivity, primarily through implementation of modern production technologies and management methods».

In Derek Byerlee’s opinion, the main opportunities for improvements reside in transfer of advanced technologies, investment in agricultural research, and implementation of modern methods of farm management. In addition, it is necessary to ensure competitive land market in order to minimize the effects of imperfections in financial and output markets, and ensure an efficient use of land and an equitable distribution of the benefits.

In turn, the President of UCAB Alex Lissitsa emphasized that Ukrainian agricultural companies have considerably increased their efficiency, mainly due to expansion of land banks and reduction of costs. «At the same time, we observe deepening of the bimodal efficiency distribution among small and large agricultural enterprises. This will cause further acquisitions of small-size enterprises by large ones. In the next two or three years, the lion’s share of grain and oilseed production in Ukraine will be concentrated at 300-400 enterprises», Alex Lissitsa said.

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