Currently, the Ministry of Agriculture, together with retailers, is trying to develop “price corridors” for products that are in the greatest demand.
At the moment, the Ministry has already developed a bill that creates special price corridors for the most important types of agricultural products. It is planned that such corridors will be fixed in long-term contracts that the department will conclude with business representatives.
It is assumed that such changes may come into effect as early as March next year.
So far, the Ministry has sent the bill to various national unions — for example, milk, fruits and vegetables, poultry farmers. It asked to review this document and express their suggestions and wishes for its revision.
At the moment, there is every reason to believe that in one form or another, the bill will certainly be adopted in the foreseeable future, experts emphasize.
In general, it is planned that long-term contracts will very soon become the basis for the relationship between manufacturers and retailers and that about 80% of all products will be purchased under them. This should make the market much more understandable and predictable.
In addition, price volatility should also be significantly reduced, because this is the purpose of introducing the so-called «corridors», that is, establishing the maximum and minimum price at which a particular product should be sold.
Finally, seasonal price fluctuations will also be smoothed out, analysts believe.
So far, the list of goods that will be subject to regulation has not been determined, although this is the main point that the bill will contain.
It is assumed that the list will necessarily include potatoes, «borscht set» vegetables, as well as apples, cucumbers and tomatoes. In addition, eggs, sugar, milk and sunflower oil will most likely be added to it.
As for the opinion of businesses regarding the upcoming changes, it is ambiguous.
On the one hand, entrepreneurs see the positive in the fact that a significant part of the manufactured products will be sold through the format of long-term contracts, since this makes the business more predictable.
However, strict regulation of prices reduces the profitability of companies and the investment attractiveness of the entire sector.
Combined with the difficulties that farmers already face – for example, rising production costs, a high key rate, export duties on many types of goods – this could lead to the reduction or closure of some production facilities.
