A Conversation with Ukrainian Agrarian Council Chairman Andrii Dykun
Feeding Ukraine’s Future features a discussion with Andrii Dykun, Chairman of the Ukrainian Agrarian Council. The agriculture sector has been a main engine of Ukraine’s economy since before the war. This podcast provides a stark look at everyday life for the country’s network of farmers, considered some of the country’s most important small business owners. Some have been imprisoned by the invaders and others are being forced to sell their crops below cost.
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MOVA: The Business Language for the New Ukraine is a new podcast series hosted by Andrew Wilson, CIPE’s executive director. The series is a part of CIPE’s Democracy that Delivers podcast.
Transcripts are available in English below
Feeding Ukraine’s Future, with Andrii Dykun, Chairman of the Ukrainian Agrarian Council (English Transcript)
Andrew Wilson:
When we hear about the war in Ukraine and what’s needed in terms of aid, the conversation is usually about supplying weapons. Making sure the Ukrainian military is able to fight is vital. So is keeping the Ukrainian economy afloat during this war, and that means helping an important small and medium-sized business sector: farmers.
Andrii Dykun:
We got weapons from our partners, but we don’t get money to pay salaries, for example, to the soldiers in the army. We need to make money for the war by ourselves. And since the beginning of the war, the agricultural sector is the main locomotive of Ukrainian economy. And when farmers are not able to sell and the price is below the cost, then it’s a big challenge for the future.
Andrew Wilson:
Stories from the front lines of the tremendous efforts underway to help save the Ukrainian agricultural sector and why more assistance from the international community will be vital to keep it afloat. That’s just ahead.
I’m Andrew Wilson, executive director of the Center for International Private Enterprise. Welcome to MOVA: The Business Language for the New Ukraine, a podcast from CIPE where we’ll take a deeper look into Ukraine’s economy, policies, and business outlook.
Our guest today is Andrii Dykun, the chairman of the Ukrainian Agrarian Council, the largest agricultural association in Ukraine, and a former Deputy Minister of Agrarian Policy and Food. Andrii joins us to share his perspective on the role the agricultural community and business leaders can play in helping to rebuild and deliver prosperity in Ukraine. Welcome to MOVA, Andrii.
Andrii Dykun:
Thank you.
Andrew Wilson:
We all, sitting outside the country, know that this has been an incredibly difficult year for Ukraine. How are you and your colleagues doing?
Andrii Dykun:
In our organization, we have more than 1000 members and some of our members are on occupied territories and most of them are imprisoned by Russians. Other parts of members are on the occupied territories and their farms are destroyed; their fields are mined. And the rest of the farmers are in the west, north, south and middle of Ukraine, they are also not feeling good because they can’t sell their product. But for example, yesterday we had a general meeting of our members, and we all understand that it’s very difficult for us, but it is not so difficult for us as it is for our farmers who are in jail and as it is for our farmers who are on the occupied territories. And last but not least, it’s not so difficult for us as it is for the Ukrainian army. So it’s very difficult, but some people are feeling much more difficulties than we are. So we have no other choice as to continue and help as much as we can.
Andrew Wilson:
I know the Agri Council, and I know it’s an outstanding association for its members. Can you tell us a little bit about what you’re doing to help your members at this point, what the Council itself is working on? I recall in an earlier conversation you used the term that war is now sort of a habit for people. That denotes that people are learning to live with the situation, but clearly, you at the Agri Council have had to develop your own approaches to help your members in that regard. Can you tell us a little bit about A, what are the prime issues your members are facing and B, how the Council is working to help them in this new environment?
Andrii Dykun:
Just a few words about the Council. So when I was working in the Ministry of Agriculture, I realized that Ukrainian farmers, they are not presented in the parliament, they’re not in the government, and some people, they can do what they want to do about agricultural policy. And then we analyze the world, and for us, the US model of doing agricultural business is very understandable because in the US, agri is business. The same in Ukraine, the agricultural sector is business. So we did more or less the same that you guys have done many, many years ago. So we just settle association and our main task of association before the war was to advocate the interest of the farmers in the parliament of Ukraine and in the government of Ukraine.
We also take into account that the war started in 2014. We were used to protecting our farmers. So we had our private protection company. We had more than 100 people working there, but now all those guys, they are in the army.
We help our farmers with bookkeeping, with tax legislation, answer the usual questions they ask us to help them with, and we also start some cooperatives. Like in America, we have cooperatives and we start to do some grain cooperative, new cooperative. And also we do a lot of education for the farmers.
But the first days the war started, we have realized that if our cities would be surrounded by the Russians’ army, they would immediately die if there is no food. So two days after the war started, we started to send trucks with grain to Kyiv. Kyiv was not surrounded at all, but only one way was to Kyiv from Odesa. So we were sending 10,000 tons of wheat to Kyiv in order they could make some food and send more than 5,000 tons of different food to cities like Mykolaiv, Chernihiv, Kharkiv, in order to give this food to people.
And later on, in April we get to know with Jose Andres, he’s a famous cook, in the World Central Kitchen organization, and we talked to him that they were helping a lot, but they were mainly bringing food from Europe, and we were asking him not to bring food to Ukraine. It’s better to buy food from local Ukrainian farmers and to give this food to people. And, they started to do so and I’m very grateful for that and all American people because only through the World Central Kitchen, it was a $450 million investment in the food which was given to Ukrainian internally moved people or people in affected areas and so on. So it was a great job done, which is not very, I would say, popular because most people think that Americans help us only with weapons, but it’s weapons, yes, but not only weapons.
Another thing which was important for us is to somehow help our farmers on occupied territories. To bring, for example, they have farms, no pharmacies there. They can’t buy any medicine, any food for the cows, for example. So we were supplying all this for them.
Andrew Wilson:
Andrii, how can you get help into the occupied territories? I would think that would be incredibly dangerous.
Andrii Dykun:
Yes, it was dangerous, but we were sure that it’ll not last so long, for example. And we need to bring some medicines. For example, for cows, if there is no medicine, cows will die and so on. But then we stopped after the Russians… It was like first month, maybe month and a half. But then Russians, they took control over the farms and that’s it. So we stopped any connection to them.
Andrew Wilson:
What do we know about the conditions of these farmers now that are behind Russian lines? Are they able to do anything? Are they surviving?
Andrii Dykun:
So the situation is like that. Some of the farmers during the first half year of occupation, they run away from those territories. They went to Crimea, from Crimea to Georgia, from Georgia to Europe, and from Europe back to Ukraine. That was the way how they managed to escape from that territory. Their farms were given to Russian state control and they bring some people from Russia and these people now are trying to run all those farms and so on. And unfortunately many of our farmers were jailed. Some of them we managed to talk to Ukrainian politics, and they changed them for Russian soldiers, for example. Like last guy was sitting in the prison, he was for more than one year and he was just a farmer. And that’s the situation.
All the grains the farmers had, taken the grain and sold it somewhere. I don’t know where they sell them by. I think they took it first to Crimea and then they exported it somewhere. So most of those farmers are here and some of them are in the Ukrainian army now. They want to help soldiers to save their land back to them.
Andrew Wilson:
And I think something to stress is that not only are farmers business people in Ukraine, but they’re small business people. And they’re probably supporting families and other people. Are you able to help them out in any way when they are able to resettle in Western Ukraine or make their way back into Western Ukraine or what’s available for them when they come back into Ukraine?
Andrii Dykun:
They all think that the war will be over soon, but already it has taken a lot of time. And for example, what we do, a lot of people, farmers from Kherson region, for example, they used to grow vegetables and Kherson region was like a vegetable region for Ukraine. Now it’s occupied, so just tells us farmers that, “Okay, we can give you some land from other farmers,” where a farmer was growing wheat, for example, and we supported them with money.
They established an association of farmers of occupied territory, and we also helped them advocating their interests because unfortunately for example, banks are asking those farmers to pay credits. And you can imagine the situation. Their farm is occupied, for example, like in Zaporizhia region. There is an electrical operator and he’s sending bills to a farmer whose farm is occupied and the farmer is not on that territory, the farmer is here in not occupied territory. And the operator is asking him to pay bills for that Russians are using his farm now. It sounds absurd, but that’s the reality. And of course those farmers, they need help.
We help like advocates, lawyers and then when, for example, the territory is deoccupied, then they want to come back. But what they see that they need money for this, to restart their business and unfortunately they don’t have money for that. And banks in Ukraine, they don’t give money to them because they’re afraid that maybe later the Russians will be back and everything will disappear. So that’s one of the ideas, we are talking now to many financial institutions in the world like World Bank, European Bank for Reconstruction and Development, USAID, that we need to focus on helping especially farmers from deoccupied territories to make a foundation for them, so they could take out loans.
Andrew Wilson:
That’s an amazing story. And sometimes I think we really don’t think about these sort of what seem to be crazy situations that people end up in. One of the bits of footage and films we see on television here in the United States when we see reports from the war in Ukraine are the huge amounts of unexploded mines, wrecked tanks, other military equipment, damage to property that exists. How can we get these farmers’ fields even back into productive use? It would seem to me that that’s probably the first job, other than finding a place to live, that a farmer has to deal with, is his own ground, his own land.
Andrii Dykun:
Yes. That’s a big issue for Ukrainian farmers on deoccupied territories. And still there are a lot of fields which we cannot even investigate because the frontline is very close and the frontline is very big. It’s more than 1000 kilometers. So it’s still a lot of fields we don’t even know what is there. And of course, there are some fields which are deeply mined. Then, of course, we need specialists for those fields, with special machinery and so on. We even talk with the Ukrainian military specialists on demining, and they showed us one machine so the farmer could put this machine in front of his tractor for example, and if there are some mines on the field, then the farmer himself and the tractor will be okay. But some part of the machine can be destroyed and then it can be removed and the farmer can continue.
Andrew Wilson:
Very dangerous situation.
So we’ve talked about the funding question. How do you get the money to restart your operation? How do you resolve the debts and the bills that people keep sending you? We’ve talked about the physical security problem and issue that the farmers have in terms of land that’s been destroyed. Of course the other piece of the puzzle if you’re a farmer is the supplies that you need to grow the crops to fertilize, to treat for insects. Are there things that your association is doing, or that your association might have a perspective on, in terms of making sure that those supply chains of product going into the country are accessible to these farmers and what are the key problems that those farmers are having getting those supplies in the first place?
Andrii Dykun:
From the beginning of the war, the only problem was diesel because most of our diesel was from Belarus and partly by the sea. And we were producing only 15% of diesel in Ukraine. What we did as an organization, we immediately bought big trucks for diesel and we now deliver diesel from factories in Europe directly to the farm. We solved this issue in two months. It was done, no problem anymore. That was the only problem of inputs.
The other, fertilizers, Ukrainian fertilizer companies are operating still, which is good. What we do, for example, for the farmers on the deoccupied territory, like this season, they needed winter barley, winter wheat and winter rye seeds. So, we raised money from our farmers and then for that money we bought seeds for them. That’s the way we help them. But on deoccupied territory only. For the rest of the farmers, input is not a problem at all. The problem is that we can’t sell our product.
We have good yield this year. Grain yield is not working anymore. We do not have prices. Our production cost is higher than the price for the farm. And that’s the problem. And that’s very important for Ukraine because 50% of our budget is given by our partners. We got weapons from our partners, but we don’t get money to pay salaries, for example, to the soldiers in the army. No one gives us money for the war. We need to make money for the war by ourselves.
In Ukraine, why is the agricultural sector so important? Because compared, for example, to the US, in Ukraine, the agricultural sector is around 20% of the GDP. In United States it’s around 2%, in European countries it’s like 3%, 4%. And since the beginning of the war, the agricultural sector has been the main locomotive of the Ukrainian economy. And when farmers are not able to sell and the price is very low, below the cost, then it’s a big challenge for the future. And that’s what we do now. We ask our partners, US and European countries, “Guys, we need to help farmers to have normal prices, just normal prices for their production. And for that, the only possible way, what we see now in Ukraine, is to make an intervention.”
Andrew Wilson:
I hear all of these activities that your association is doing, which are so vital, so important. How do you do this? Do you have lots of people volunteering to help out? How do you organize your association as an executive to respond to all of these needs? It must be an incredible amount of work and I can’t imagine just the professional staff of an association being able to do this by themselves.
Andrii Dykun:
So we have a special team, which I call “Humanitarian Direction.” Now we start with World Central Kitchen, now we do it by ourselves with other donors, or by our money. We still continue to make food boxes. We have two warehouses in the center of Ukraine where we pack food boxes and we send [these] food boxes by trucks to the deoccupied territories, and we use our farmers like a network, because a farmer has a truck, a farmer has a warehouse, and a farmer knows very good people in his village. So he will give every family a box per week. So we do a lot like this as humanitarian.
Another thing is vegetable seeds. It’s also very important to support people on the deoccupied territories on, we call them backyard farms. It’s a small garden near your house. So we were supplying seeds, a lot of seeds to our farmer members, and they distribute the seeds to people in their village. That’s how it works in our humanitarian.
The same is with medicine, for example. We have a list of farms, we have a list of people who have animals. We send to farmers and we trust… very trustful network. And from the beginning of the war, we also established a charity foundation. Now it’s one and a half years, because for some donors it’s very easy to work with us, Ukrainian Agricultural Council, as non-government organization. Other people don’t understand this, they want charity foundation. So we have even charity foundation.
Another side for us is we also help the Ukrainian army a lot. Ukrainian chief commander, Mr. Zaluzhnyi, he mentioned that one pickup truck, one pickup truck, saves one life. So we already have sent to our Ukrainian army, 1,300 pickup trucks, which we bought in Europe, delivered to Ukraine. We fixed them and sent them to the army. And that’s one of the things I would like to use an opportunity today because our farmers, especially from this affected territories, they do not have such trucks anymore because they were all destroyed or mobilized to the army. And with this truck, pickup, it’s much more safe for him to use field rollers to be in the field, because if there is a mine, he has a chance to survive in a pickup truck.
Every farmer has different needs, some need seed, some need tractors, some need harvesters. So you cannot guess what they need but everyone needs a pick up. And Jose told us yesterday that he will donate $1 million and he will talk to other people and maybe together with them and other people in the US we will manage to deliver some pickup trucks to Ukraine to give to every farmer on affected territory. And that’s also the way we are trying to help them. So you need to spend a lot of time, communication, negotiation.
A lot of donors now are coming to Ukraine and if our member wants to take some money from the donor, he needs to send an application and to get money from the donors. But to write an application, you need special skills and knowledge. You need to know how to write, how to describe, and in many cases it should be done in English. So again, we have a special department with seven people who from day to day, every day they talk with farmers about their needs. They know all the donors, how they could help farmers. They write these projects together with the farmers, standard projects to the donors. Sometimes they win, sometime not. But that is the way how we operate. As an organization, at this moment, in our council, there are around 400 people.
Andrew Wilson:
That’s amazing that maybe 400 people are able to make such a huge impact on the situation for agriculture in Ukraine.
The other issue that we hear a lot about in the West, of course, is the issue of grain exports. It’s very timely right now because of the collapse of the deal to allow ships from Odesa, which means that Ukraine must export its product right now via land channels. And there are all sorts of problems, maybe small, maybe large, with some of your neighbors about moving grain through those markets. What can you tell us about what the Agri Council is doing to help resolve these issues?
Andrii Dykun:
What we do, we try to communicate with our partners. For example, I just returned from Lithuania where I met with the Minister of Agriculture of Lithuania and leaders of Lithuanian Farmers Association to explain to them to not be afraid of Ukraine or product in Lithuania because yes, it’s not good for you, you’ll make less money, but you pay by money, and we pay by our lives. And we communicate with Poland, with Hungary, Romania, Bulgaria, all those countries who at the moment they protect exports from Ukraine. And this is not very good and we don’t like it. We try to communicate to them because on the one side they help us with weapons. On the other side, they don’t give us possibility to sell. But even so, if it is okay and we could sell to EU countries, it’ll not help us a lot because the railway connection and the road connection is not enough.
I can give you figures. So before, once the grain corridor was working, around 3 million tons we were exporting through Dunay ports, and 3 million tons we were exporting by Odesa ports. By railway was around 1 million, and by trucks half a million. Now, Odesa port is not available anymore because no grain deal and Dunay ports are under attack almost every day by Russians. So railway for us is not solution. And globally there is only one way for us: Odesa ports, deep water I call. And for that we need F-16.
Actually, that’s when I talk because since we help the army a lot, we talk to our generals and they said, “Guys, if you want your ship to go from Odesa, we need to protect from the air. And the only possible way for that is F-16.”
Now, we are very thankful to the United States and other partners, and our pilots now are training. So we really hope that by the end of the year, F-16 will be in Ukraine and that they could help to protect our sky and we would have normal exports. But up to now, we have good yields, good products, but the price is below the production cost. Makes no sense.
Andrew Wilson:
This has been a fascinating discussion Andrii, and I want to thank you for giving us these insights about how closely interlinked Ukraine security is with its agricultural security. And I think that’s something that people don’t give enough thought to. The stories you’ve told us about how directly the agricultural sector is not only paying the salaries of soldiers through their taxes and their product, but also they’re doing it in an incredibly difficult operating environment, often, it sounds to me is at a loss. But yet they continue to farm because it’s what they know how to do and the contribution they know how to make and your association is key to helping them get that done.
And I want to congratulate you personally and the 400 who work with you on making lives for Ukrainian farmers, at least something that they can do. And in a way you’re also helping the war effort in a very concrete way and I really hope that you can find those pickup trucks you need. I hope you can resolve your credit issues for your members and these absurd situations for them when they’re holding debts on land they can’t control. These are stories that are very important, I think, for people around the world to hear. So I just wanted to offer my thanks to you and to wish you more success in the work that you do.
Andrii Dykun:
Thank you very much. I would like to take this opportunity to say thank you to every American citizen, to all American people because you really, guys, you help us a lot, a lot, a lot. Without you, Ukraine would not survive. And I think I would not be in Uman today and talking about agricultural sector. I would stay somewhere in Western Europe or maybe in the US. But thanks to you, we are fighting. Thank you very much.
Andrew Wilson:
Thank you. And we’re with you and we’ll keep up the fight with you.
And thank you for joining us on this episode of MOVA. For more information on the Center for International Private Enterprise and our work, please visit our website at cipe.org. If you found value in this episode, please show your support by liking and subscribing to MOVA. Sharing this podcast with others helps expand the conversation. Thank you.
Published Date: September 22, 2023