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Do not need to Ukraine once again to view the concept of construction of wholesale markets?
15:15 01/25/12

The State target program of wholesale markets of agricultural products was approved by the Cabinet of Ministers of Ukraine 3 June 2009. It provided a set of measures, including construction of 25 wholesale markets. It was expected that they will be erected near each regional center. And a year later the government was forced to suspend implementation of the program, and now it is under real threat of disruption.

On the difficult situation that is unfolding around the wholesale markets, and the problems they face, talking with the head towards the "development of market infrastructure" Project USAID «Agroinvest" Mykola Gritsenko.

- In your opinion, why the government froze the program of wholesale markets?

- Due to lack of funds. The resolution of the Cabinet of Ministers № 704 clearly states that it is done to optimize the government expenditure and reduce the number of state programs.

I have to say that the fate of the program from the outset consisted not easy. For the second year of existence it has undergone significant changes. In particular, changed the strategy of forming a network of these markets. It was decided to expand their building is not next to each regional center, as expected earlier, but only near major cities. This means that today is actually the construction of only five or six wholesale markets.
- Conventional wisdom dictates that the idea of ​​wholesale markets failed to function due to lack of adequate food security. What you say about this?

- The problem of product filling is not the test of time. It is therefore difficult to say whether it is acute and the effect on the activity of wholesale markets.

As you know, we still had no wholesale markets. Thus, the wholesale market of agricultural products "Capital", which is on the outskirts of Kyiv, began to be built only in 2011. He is still being developed. Instead, people in the market now sell something and buy something. Yet no one complained about that lack of agricultural products.

- We are talking about wholesale markets and even call some of them. But are there in Ukraine wholesale markets? Of course, if you go with the classic understanding?

- Actually, wholesale markets in Ukraine. As in all markets, who received the status of "wholesale" wholesale and retail trade, and thus formed two prices.

Wholesale markets, applicable law, perform several important functions. In particular, they form the wholesale prices, provide logistics movement of agricultural products, providing the opportunity to work retail. Above all, it comes to retail food chains, small urban markets and more.

Thus, the wholesale markets should operate exclusively wholesale prices. And they should pay only for bulk buyers. And the wholesale markets and retail trade. Therefore, we Changing concepts: we call the wholesale markets that, in essence, is a wholesale and retail. And between them there is a substantial difference.
- It is well known that most fruits and vegetables in Ukraine producing small farmers. Logically, wholesale markets must fully meet their needs exactly. And the situation looks really?

- According to statistics, it looks exactly as you say. For example, individual farms grow 80-90% potatoes. They lead and in many other positions. It is only if we talk about fruits and vegetables.

Simultaneously with the construction of wholesale markets need to solve two tasks - to form around them and form the raw material zone navkolorynkovu system. It is about forming stockpiling, marketing organizations - or cooperatives or marketing groups. Because the markets have come organized operators who work on behalf of small producers.

Correctness of this approach confirms the domestic and foreign experience. And each time, once it is ignored, we see a picture - in the wholesale markets do not begin to dominate domestic producers and traders who imported goods from abroad.

At first glance, as if nothing special happens. Some people think so - the main thing that had something to trade, and that was that buy. And in fact this approach is wrong.

The situation looks normal to the wholesale markets preside domestic producers. Because we are buying their products, and support their production. Thus, it becomes stronger financially, technically and technologically updated. Our farmers have an incentive to work and benefit from it, and we all - in the form of income taxes they pay to budgets.

If at first traders breaking, then we seriously think about - do you sometimes not make a mistake somewhere? For in that case have to invest in foreign economy, foreign funds to fill their wallets.

In fact, wholesale markets have many tasks, but one of them - to bring the interests of Ukrainian farmers and buyers. As for me, yet they can not cope with its execution. Until now, many wholesale markets, traders and dealers can meet more frequently than those who actually grow fruits and vegetables.
- How would you have reacted to the fact that wholesale markets belonged to the union of farmers, which they intended to serve? And the second question - who actually wholesale markets in Ukraine belong to?

- I have no information as to who exactly owned wholesale markets. One thing I can say - they are private entities. This feature is Ukrainian. Because the world is most wholesale markets or associations of agricultural producers, municipal authorities or bodies.

According to statistics of the International Association of wholesale markets in Europe, only 7% of the wholesale markets are privately owned. In the Americas, the figure is 13%.

Often in the world practice a mixed form of ownership. This is when the wholesale markets at the same time belong and agricultural producers, and municipal authorities. Usually, in such markets established market committees. Their composition includes representatives of local authorities and farmers. Together they agree on all issues related to the markets, their presence on them. Together they form the policy of the markets.

As I said, all without exception Ukrainian wholesale markets are private. Agricultural producers of them actually have customers. They have to act according to the rules for development which have no relationship and which do not always match their interests.

- Building a network of wholesale markets of Ukraine follows the European example. And today in Europe is the situation with wholesale markets?

- The situation is quite interesting. European experts say that the continent were two era. One of them lasted until the 80s of last century. It is characterized by a large rise in the development of wholesale markets.

Then in the European wholesale markets there has been a decline. Now this era has been named the era supermarket chains.

Let me give you an example. Wholesale Market, located near Berlin, the reason is one of the largest in Germany. In the 60 years he provided the city agricultural products by 60%. Today, that number fell to 15%. The remaining supply of agricultural assumed supermarkets.

At some point the question - what to do with dying market? After all, he steadily lost its niche. Exodus is not found soon, but I have to say - find a good way.

The fact that around 30% fruit and vegetable market halls rented by Turkish companies or companies with owners of Turkish origin. They have always controlled a significant portion of retail turnover produce Berlin. Of course, these companies do not want to leave their positions on the capital market of food and therefore had no intention to go to the wholesale market. Therefore, later made into an object for logistic perevalok products with others.

Another example: in the UK over 80% of consumers buy produce in supermarkets. So, the problem on the future of wholesale markets and overdue in this country.
- You talk about old Europe. Wholesale markets were built in 40-60s of last century. But the new Europe and particularly Poland have been actively developing wholesale markets recently. So it turns out that the need for them still?

- In Poland formed a network of wholesale markets, which consists of 4 inter-regional and 8 smaller wholesale markets. Their building through various financial institutions involved 140 million euros. But Polish experts acknowledge that even with such powerful financial commitment targets are not achieved.

Previously among Poles pobutuvala opinion that wholesale markets will be built at the budget and raised funds for this, and eventually redeemed their farmers. If not immediately, then the particles. Thus, the Polish program did not provide market sale into private hands. And, unfortunately, Polish farmers could not buy or wholesale markets, or their shares.

Quite a striking example: the market area, built near Gdansk, has 23 hectares. Since its opening splynulo 13 years, and he is now loaded by only 30%. Proceeds market is not enough even to cover the loans the World Bank. These costs are borne additional burden on the state budget in Poland.

So we need to take a cautious form a system of wholesale markets. It should take into account the experience and the old and new Europe.

- It turns out that Ukraine has already set about implementing the outdated idea of ​​building wholesale markets. Is it not better, using the modern European experience, establish wholesale trade through trade networks that are formed quite successfully in our country?

- From the wholesale market, we already figured out and understood the situation, which is around them remains difficult. However, European experts do not idealize and supermarkets. Instead, they express concern about monopoly, which establish multinational retailers.

There are statistics, under which up to 95% of value added products sold in supermarkets network, "runs" of the country. And it turns out that some work and others - rich. Do we want this? Of course not.

I have to say that this trend does not suit not only us, the Ukrainian people. European countries are also concerned about the dominance of transnational trade networks and looking for ways to diversify the activities of wholesale markets. Just in our situation has not yet become critical. According to various estimates, Ukraine sold through supermarkets about 10-15% of agricultural production. But we will not podinemosya from global trends. So my view is: should build logistics facilities, vegetable store, to develop a national network of retailers and fully support it. The same should be maintained and wholesale and retail markets. This - our national tradition: sell and buy in small markets. But it is necessary that the owners of such markets were our farmers.
- What to do with the large markets that are already working and who, by habit, we still call the wholesaler?

- It would be nice if they turned into the terminal storage of agricultural production, storage and further the division between the regions. Above all this applies to the southern region where the product is made especially numerous.
- Building markets that could support the project "Agroinvest"?

- The project is supported to a small regional markets around the zone of concentrated agricultural production. And first of all, supported the policy would create wholesale and retail markets, which are the owners of producers and local authorities. To make it clear that these markets are built for their manufacturers to promote their products. I am confident that these regional markets cutting-better under the dominance of multinational retail chains.

Myhailo Vernygora,

National Press Club "Ukrainian Perspective"

See also
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04/03/11 RosUkrEnergo to give back 12.1 billion cu. m of its gas to Ukraine
03/20/11 Foreign air companies knocking on Ukraine's door
03/20/11 Norwegian businessman to invest UAH132 mln to update pig farm in Ternopil oblast
03/03/11 Land market in Ukraine won’t be transparent and fair, Oleksandr Paskhaver says
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