Ukrainian pig industry has no alternative to export development

A population outflow has left Ukrainian pig farmers largely dependent on military orders. In the long run, farmers need to search for foreign markets to ensure the industry’s sustainable development, according to local market players.

The Defense Ministry’s auctions largely support the Ukrainian pig market. They account for 30% to 35% of the entire demand in the country, Ihor Liakhovsky, Head of the Export Group of the Meat Industry Association and founder of Agro-Invest LLC, revealed. During the gap between the auctions, which takes several weeks, the wholesale price usually plunges, he added.

The Ukrainian pig industry managed to bounce back from the initial slump in output in 2022 and restore pork production to the pre-war level of 600,000 tonnes per year. Liakhovsky warned that, given that millions of consumers left the country, the existing dynamics could soon drive the pork market to a state of oversupply.

After that, farmers’ interest in pig production is likely to decline. This means that state support and existing investment programmes will devalue, he warned.

To gain a foothold on foreign markets, Ukraine needs to improve the pig industry’s competitiveness. The massive use of ethanol industry by-products as a feedstuff can assist, Taras Mykolayenko, Executive Director of Ukrbioethanol, association of ethanol manufacturers said. “Ukraine can earn €6 billion of added value from the development of dry-fed pig production, and with cheap proteins – bioethanol waste, it can be as high as €12 billion,” Mykolayenko estimated. The bio-ethanol industry could serve as a backbone of the pig industry, he asserted.

Mykolayenko stressed the critical need to provide Ukraine with affordable proteins. He warned that failure to do so would result in a perpetual loss of competitiveness in the global pork market to the US and Europe, who have successfully implemented bioethanol programmes.

The first steps on the export development track have already been taken. In June 2024, Ukraine became a net exporter of pork, with exports exceeding imports by 50%, the Ukrainian pig farmers association reported. Ukraine exported 296 tonnes of pork worth US$700,000. The UAE bought the entire volume.

Looming oversupply on the domestic market is one of the key factors facilitating Ukraine’s turn into a net exporter in recent months. “Due to the drop in prices on the domestic market, which was observed in the first half of the year, this is quite natural: a lower domestic price creates an entry barrier for imported pork and helps improve the competitive position of [Ukrainian] products on foreign markets,” the organisation said.

Tags: Ukraine, export, pork, Production, foreign markets, pig farmers, pig industry, pig market