UCAB proposes to the government to categorize export cargoes: details

The Ukrainian Agricultural Business Club proposes that the government give priority status to agrologistics and port processing of agricultural products with high added value.

The proposal also includes the introduction of categorization of export cargoes by value added, the Ukrainian Agricultural Business Club association reports.

The Ukrainian Agricultural Business Club noted that in today’s conditions, the key task for the state is to maximize foreign exchange earnings for each ton of exported cargo.

“However, currently, the shortage of wagons, delays in approving plans, and downtime in ports lead to the forced shutdown of oil extraction plants. This leads to the disruption of long-term foreign exchange contracts and discourages agricultural producers from investing in domestic processing facilities,” the association notes.

One example of products with high added value is vegetable oils, meal, and cake. The cost of a ton of such products is on average 2–4 times higher than the cost of a ton of raw grain. Accordingly, the use of scarce railway rolling stock, locomotive traction and port terminal capacities for the export of processed products provides a larger volume of currency for the state economy.

“Given that the state is already successfully applying the mechanism of priority non-queued movement for strategic cargoes (for example, for fuel imports), the agricultural community calls for the introduction of a similar approach for the export of agricultural products with high added value,” the proposal states.

In particular, the UCAB proposes:

• to adopt a joint regulatory legal act or a protocol decision of the Cabinet of Ministers, which will consolidate the categorization of export cargoes by the level of added value and determine the procedure for granting them priority when distributing limited logistics resources;

• change the priority algorithm of JSC “Ukrzaliznytsia” in accordance with the specified categories, ensuring the priority of transportation of products with high added value, in particular vegetable oils (in tanks and tank containers) and meal and cake (in hoppers, gondolas and containers), as well as priority traction and dispatching of route shipments of such products to western border crossings, sea and river ports. The above also applies to road crossings, where food with the maximum added value is exported;

• establish a regulatory priority for SE “USPA” for the reception and unloading of transport with high added value products at port terminals;

• ensure priority mooring and cargo operations for vessels with processed products, as well as their priority passage through the Ukrainian Sea Corridor and the Danube.

According to the association’s experts, this approach will allow for more efficient use of limited logistics resources, support the development of agro-processing, and increase foreign exchange earnings in Ukraine.

It should be noted that a corresponding appeal was sent to the Prime Minister of Ukraine, relevant ministries, Ukrzaliznytsia, and Ukrainian Sea Ports Authority.

As previously reported by USM, UCAB appealed to the government regarding the restoration of state guarantees for compensation for damage to shipowners.