Ideas for Improving Profitability in the Agricultural Sector of Ukraine

TO: Friends of Ukrainian Agriculture

FROM: Roy Chapin, Ph.D., Animal Nutritionist
    11145 Chapin Lane, Amity, Oregon 97101,
    Phone: 503-835-7317.
    Fax: 503-835-3333.
    E-mail: <[email protected]>

The ultimate objective for most of us who have done developmental work in the agricultural sector of FSU countries, such as Ukraine, is to help farmers become private, profitable and self-sufficient. How do we help them improve their management skills so that they can increase their productivity, their standard of living and the GDP of Ukraine?

Our Western humanitarian approach typically starts with teaching agribusiness management principles that have proven to be effective in our own market economies. While important, this isn't enough as too often we leave after presenting the management concepts without helping them apply the theory (using modern agricultural technology) in actual production situations. Without application, the theories we teach are not used and their standard of living remains far below its potential. What can Western humanitarian aid programs do to actually raise GDP and help the Ukrainian citizens?

I'm writing and sending this to people that can make a difference in Ukraine. Please read and determine if you can be part of the solution. Forward to those you know that may be able to help. This is a "call to arms" to all that can help develop Ukrainian agriculture.

Recently I returned from an eleven-week volunteer assignment in Western Ukraine (Land O'Lakes' USAID Farmer to Farmer Program). David Blood, Sergei Kiral, Igor Vovk and I identified several specific modern animal husbandry practices that, if applied, would make Ukrainian agriculture more money than is spent by USAID in all sectors (not just agriculture) of Ukraine. (Ukraine is third behind Israel and Egypt in receiving U.S. aid.)

We need to appreciate that Ukraine isn't producing enough protein to feed and nourish its livestock adequately. Ukrainian animal production is performing far below its potential because livestock are fed rations that are severely deficient in protein (and usually in vitamins, minerals and energy). With effective help, Ukrainians can solve this problem.

There are two attachments being sent with this e-mail. (1) My recent trip report giving some specific ideas on how to improve animal production in Ukraine and (2) A compilation of articles that I've written, including introductory explanations of what we were trying to accomplish, and where appropriate, suggested actions and potential economic benefits. All articles are available electronically in English from me. Many have been translated to Ukrainian and are available from Land O'Lakes in L'viv.

Here's a brief summary of some of what I'm suggesting:

(1) Much of Ukraine is ideal for raising canola seed (rapeseed that has been bred and selected to be low in erucic acid and glucosinolates). Canola seed can be pressed into canola oil that can be sold internationally or domestically, leaving canola meal that can be fed locally. Canola meal is a quality protein that is usually under-priced in Ukraine. I wrote, "Guidelines for Feeding Canola Meal to Dairy and Beef Cattle, Swine and Poultry" and have shown a method that will differentiate canola meal from rapeseed meal. By improving feed rations, swine for example will grow twice as fast on half as much feed and produce a better carcass than is typical today in Ukraine. Check the attached list for more information, including swine rations formulated with canola meal.

(2) Ukraine has great potential to use beet molasses in the manufacture of liquid feeds for ruminants, particularly dairy and beef animals. There are 192 sugar factories in Ukraine. I'm told that each of them has 2500 to 4000 metric tons of farmer-owned beet molasses available each year. By combining beet molasses with urea, phosphoric acid, vitamins and minerals, each sugar factory could produce four to six thousand tons of a high protein liquid feed. In a series of articles, I explain how to formulate, manufacture, deliver and feed liquid feeds and predict the economics of animal response.

From the beet molasses available in Ukraine, it is possible to manufacture a million metric tons of liquid feed a year. There are 5.8 million dairy cows in Ukraine. Each cow could thus be fed 500 grams of liquid feed daily throughout the year or one kg daily for the half of the year that they are in the barn (not on pasture) being fed winter rations.

I predict that the economic benefit from improved milk production for each ton of liquid feed fed to lactating dairy cows is $200 above the cost of ingredients. This means that if this technology were applied, $200 million of added wealth could be created each year in Ukraine. This is sustainable year in and year out. Ukrainians can do it themselves. Compare this with the $195 million that USAID has been spending yearly in all sectors of Ukraine. Consider these important differences: most of the dollars from USAID go to Americans supplying training that must then be applied by the Ukrainians for them to benefit. USAID's money comes from U.S. taxpayers. It is not intended to be and should not be sustainable. The money created in Ukraine by manufacturing and feeding liquid feeds would go to Ukrainians and is sustainable, year after year. Isn't that our objective?

For more information on these and other topics, please read the attachments. Forward to friends. Feel free to request electronic copies of any of the articles listed that interest you. All articles are available from me in English. Land O'Lakes in L'viv has those that have been translated into Ukrainian. E-mail addresses are given in the attachments.

How can we help Ukrainian livestock producers implement known wealth creating livestock feeding practices so that they can reach their full economic potential? We need to help them combine proven agribusiness management theories taught by the West with proven modern animal science technology. Let's help them do it!

Roy - Roy Chapin