Sep 25
honey

PROSPECTIVE SECTOR: HOW UKRAINE CAN BECOME THE GLOBAL LEADER IN HONEY EXPORT

Ukraine is the largest in Europe and third largest in the world producer of honey. We are also producing one the highest amount of this nutritious and tasty product per capita. Today over 400 thousand people throughout Ukraine are engaged in honey production which is ensured by 4 million beehives. Ukraine is also on the list of top 10 largest honey exporters in the world.

At the same time, Ukrainian honey producers face a number of challenges which prevent the country from becoming the world’s largest honey exporter. Let’s take a closer look at how we can overcome them.

 

We export honey as a raw product  

After the 29% decrease of honey prices in 2016 Ukraine increased the export of this product by 58.2%, while the revenues of Ukrainian honey producers increased by 13%. Similar to 2015 Germany became the largest importer of Ukrainian honey in 2016 with 33% share in the total export volume of this product. The average export price of Ukrainian honey is $2 per kg, while the packaged honey in Germany costs already around 10 EURO per kg. At the same time, the average price of 1 kg of honey imported to Germany from another EU country varies between 3,5-7 EURO. It’s also worth mentioning that the quality of Ukrainian honey is far better than the quality of the product from China – the world`s largest honey exporter.

The retail trade of honey under Ukrainian trademarks may become a solution. Though, in order to achieve it, local honey producers have to invest more resources into marketing. Even high quality, organic honey should come in an attractive and handy package. Product promotion on external markets also requires comprehensive marketing strategy. The least one can start with, is to translate the company’s site into English.

An effective promotion strategy also includes putting emphasis on organic nature of the product. USA and EU countries consumers at the key buyers of Ukrainian honey and they adore organic products. Furthermore, Ukrainian honey corresponds to all European standards of quality since 2003. Ukrainian scientists also invented a new technology for honey collection. Its key feature is that honey is produced by wild bees that live in their natural environment slightly modified for production purposes. Only 25% of such honey produced under this technology will be taken away from bees, while 75% will be left to them. Such technology will also prevent bees suffering from seasonal transportation.

Due to tough competition Ukrainian honey producers are selling their product at very low prices. As a consequence, we face the situation when the bulk price of honey is lower than that of sugar.

 

Absence of the state support  

Unfortunately, the support of the honey production industry by the Ministry of Food and Agrarian Policy of Ukraine doesn’t go far beyond discussions and declarative statements. “Taking into account the current budget deficit, any subsidies for the sector are very unlikely. Our only requirement is that they don’t interfere with our work, everything else we’ll do ourselves” – Volodymyr Stretovich, the head of the Association of Honey Producers of Ukraine stated. Nevertheless, the government interferes. For example, in the beginning of the year, the “natural honey” was added to the register of products subject to obligatory licensingwithout any coordination or consultations with honey producers. This decision put an additional administrative burden on honey producers.

The increase of EU export quotas for honey is also an issue as their current volume is ten times lower than the current scope of Ukrainian honey products export to the EU.

 

Beehives’ owners abroad derive considerable profit from the provision of pollination services to farmers. In Ukraine, this type of business is heavily underdeveloped. Cooperation of beehives’ owners and farmers will be mutually beneficial and will allow increasing the productivity of bees and plants. Plants’ pollination by bees increases the yield of cucurbits crops by 60%, of horticultural crops – by 65% and of the red clover by 75%. The medick seeds are practically impossible to obtain without natural pollination. Honey producers should unite in order to influence the state policy on honey production. Draft of a state program of cooperation promotion between farmers and beehives’ owners would be also beneficial for all parties concerned.

 

Death of bees  

Various diseases, as well as the new phenomena in the bee-keeping world called Colony Collapse Disorder, cause masive extinction of bees. From 20% to 60% of bee families are dying every year all over the world, several times exceeding the “tolerable” death rate of 10%. In one of the Chinese provinces bees disappeared completely and now farmers have to pollinate plants manually. This problem is majorly caused by the negative anthropogenic activities such as the application of fertilizers, contamination of soil and air pollution, greenhouse effect and other climate changes. In order to overcome this challenge, we need to implement more ecologically sustainable farming and treatment technologies.

The situation with bee-farming in Ukraine is far better than in China, which gives us a competitive advantage over the world’s leading exporter of honey. Nevertheless, Ukrainian honey producers should take more care of bees’ health. Ukrainian researchers invented a bees’ treatment method which does not require an application of antibiotics or other medicines. P.Y. Hmara, the doctor of veterinary science, also developed a method of artificial control of bees’ reproduction. The global death rate of bees may be substantially decreased through the implementation of sustainable farming principles, decrease of pesticides application, etc.

Under favorable conditions, Ukrainian farmers can increase the production of honey by 30% in the nearest future. Augmentation of prices for Ukrainian honey will allow national producers to double or even triple their revenues. Nevertheless, in order to make Ukraine the world’s leader in honey export, we need to adopt governmental support programs of bee-farming as well as establish proactive associations of beehives’ owners competent and motivated enough to advocate for their rights and business interests.

Source: http://www.bakertilly.ua/en/news/id1153

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