Kyiv, February 9 (Interfax-Ukraine) – Before the spring field campaign Ukrainian farmers face serious problems in attracting funds to buy key material and technical resources, experts said at a press conference at Interfax-Ukraine.

They said that the current situation leads to increased saving, leading to the reduction of fields, less intensive processing and a fall in yields.

Chairman of the Agrarian Union of Ukraine Hennadiy Novikov said that expenses from the spring field campaign will grow by 45-50% compared to the previous year: the price of mineral fertilizers, seeds, fuel and other mainly imported production resources has grown. He said that due to saving of funds the yield this year could decline by some 20%.

President of Ukrainian Agrarian Confederation MP Leonid Kozachenko doubted the assessment of fund shortages for the spring field campaign of UAH 10 billion presented by the Agricultural Policy and Food Ministry, and official data on the availability of key materials and technical resources. Kozachenko said that in the previous pre-crisis years the shortage of funds reached UAH 30 billion.

"Then, banks worked and the funds could be received. According to our assessments, [in 2015] the shortage of working capital is up twice compared to the previous years," he said.

The MP said that this year the solution could be collateral purchases made by the Agrarian Fund, secured by the targeted printing of money by the National Bank of Ukraine and prepayments made by traders under forward contracts.

President of the Ukrainian Agribusiness Club (UCAB) Alex Lissitsa said that the most acute issue is the purchase of mineral fertilizers, as domestic production does not ensure the needs of agriculture in full, while imports have been blocked for over a month as the Ecology and Natural Resources Ministry has not signed the required license.

"Even if the fields were reduced, it will not be as painful as the reduction in investment in fertilizers. The yield actually depends on how many fertilizers are used in spring," Lissitsa said.

According to a poll conducted by UCAB, at present the availability of mineral fertilizers for farmers is 5-7%.

"With this volume of fertilizers there is no possibility of speaking about large yields. This will actually be subsistence production," he added. He said that in spring 2015 Ukraine will cut fields with sugar beets, corn and barley as non-profit-making crops, but sunflower fields will be expanded.

Deputy Chairman of the Verkhovna Rada of Ukraine Committee on Agrarian Policy and Land Relations MP Oleksandr Bakumenko and Chief Analyst of the Ukrainian Agrarian Association Maryan Zablotsky paid attention to legislative steps taken to support agriculture. Bakumenko expressed hope that the law on deregulating business (No. 1158), which revokes the necessity of drawing up crop rotation plans, reduces the number of documents for registering farmland leasing agreements and sets the minimum term of farmland leasing at seven years, will be passed at second reading next week. In addition, it is planned to consider draft law No. 1159 on the transfer of 10 million hectares of state farmland from State Agency for Land Resources management to the municipal ownership of rural councils.

"We'll remove the corruption element, being around $300 million a year, according to our estimates. This will be a real step, which will help rural areas to have property and receive all taxes from land leasing agreements," he said.

The press participants also expect that draft law No. 2003 on VAT refunding during grain exports for producers and primary sellers will be passed by parliament.