"This year is not just Olympic, but super Olympic." The largest potato farmer discusses the shortage and rising prices.
Ordinary consumers are mere spectators in this competition, having watched in recent months as prices rise for the staple food of Ukrainians. According to the interview subject, 2024 will be anything but an "Olympic" year for active participants; it will be a "super-Olympic" year. However, it seems that the businessman himself is not particularly thrilled about it.
First, most of the potatoes he grows are sold at a price that is significantly lower than what is found on supermarket shelves.
Second, he won’t pocket the profits; instead, he will use them to pay off debts incurred when Rybalko expanded production in the already nearly three-year-occupied part of Kherson region before the full-scale war.
Third, as a potato grower with over thirty years of experience, he understands that the "Olympic games" will come to an end, and for the next few years, he will have to work with minimal margins while waiting for new "competitions".
Among his colleagues, he is referred to as the "potato king," although he considers himself at most a "baron." And rightly so. His high status is ensured by a modest 500 hectares of potato plantations by agricultural holdings' standards and the fact that 95% of the harvest of this crop comes from Ukrainians' household plots.
"The number of people growing potatoes in their gardens decreases every year in geometric progression," Rybalko states as one of the reasons for this year's shortage.
What other factors have contributed to the rising cost of potatoes? Why are Russians facing problems with potatoes this year, and what are the lowest-quality chips?
On flawed harvest statistics, "elite" potatoes, and manual peeling
— Why are we talking about potatoes specifically with you?
— We have been involved in potato farming since 1996, starting in the Kherson region. When asked which area is the most potato-rich, I always say: Kherson region.
In Kherson, they practice professional potato farming: 80% of the potatoes grown there are sold, not eaten. In the west and north of Ukraine, only 20% are sold, while 50% are discarded, fed to animals, or used for seeds. This is unprofessional.
— Your farm lost three thousand hectares in the Kherson region, and now you cultivate the same amount in Zhytomyr region. What do you grow and how much?
— The main crop is potatoes. In 2021, we cultivated 200-250 hectares in Zhytomyr region, and in this and last year, nearly 500 hectares. Thanks to intensive potato production, we relocated many people from the south and can repay our debts.
In 2021, we built a storage facility in Kherson region worth 4.5 million dollars, capable of storing 15,000 tons of potatoes. Three years prior, we invested in irrigation and everything related to it. No one has forgiven our debts of 65 million hryvnias; we must repay and service them. From our farm, we are left with 35% in cash flow and half the land.
— Of the three thousand hectares, only 500 are allocated for potatoes?
— Yes. The rest were used for wheat, sunflower, and rapeseed, but we are now moving away from them. Next year, we plan to increase to 700 hectares of potatoes. It’s impossible to plant all three thousand hectares because some land is swampy, forested, or has rocky soil. We determined that 2,100 hectares are suitable for potatoes.
— What is the yield this year compared to last year?
— We have an average yield of 35 tons per hectare, compared to 31 tons last year. This has been made possible by technology and irrigation. Without irrigation, in any part of Ukraine, potato farming is a waste of time, unpromising, and unprofitable. Growing potatoes for fries or chips is impossible without it.
— Are there any farms in Ukraine that grow more potatoes than you do?
— There is a large holding called Continental Farm Groups, owned by Saudi Arabia. This is the former "Mriya". A powerful Ukrainian company that has about 150,000 hectares and grows potatoes on two thousand of them. There are a few other companies that grow close to 500 hectares.
— Why do large agribusinesses like "Astarta" or "Kernel," which have hundreds of thousands of hectares under cultivation, not engage in potato farming?
— It’s a complex and niche business that is not understood by large companies. They need to isolate a specific area from the production chain, which requires a large number of people and attention. What is needed for this business? First and foremost – storage.
There is an example where the agribusiness "ATK" ("Agricultural Technological Company") of Yuriy Drobyazko grew potatoes on 400 hectares. They had a huge storage facility for 25,000 tons. In 2021, they closed this business.
When I asked why they closed it, they said that, firstly, potato farming is not profitable every year, and secondly, in the holding's structure, its income accounts for 2%, while the time spent is 15%. That was a correct decision and a professional approach.
If potato farming is isolated into a separate enterprise within the holding, and the owner simply invests money there, he will stop controlling all processes. As Yevhen Chernyak said, if your manager knows your business better than you, then it’s not your business, but your manager's business.
— What is the current statistic on potato farming?
— According to official data, Ukraine grows 20-21 million tons of potatoes each year, 95% of which are grown in household plots. Before the full-scale war, this statistic was close to reality. Now it is completely unrealistic and at least half lower. Primarily due to the people who grow potatoes in their gardens. Their number decreases every year in geometric progression.
Colleagues from western Ukraine say that gardens of 50 hundredths or one hectare are not planted. They are sown with soybeans because it is more profitable.
Another reason why these figures do not match reality is consumption. Officially, a Ukrainian consumes about 120 kilograms of potatoes a year. If we take a population of 30 million, we should be eating up to four million tons. Another four million tons are planted each year. Where do the other 12 million go?
— You mentioned that before the war, Ukraine harvested 21 million tons of potatoes, but now the official statistic is 20 million. How is that possible considering the occupied territories?
— The Ukrainian Potato Producers Association, of which I am a board member, negotiated with the State Statistics Service. I told them: how can we grow 20 million tons of potatoes without having three thousand tons for the border troops (presumably referring to purchases for military needs)?
They replied: you are talking about quality potatoes, and we are talking about gardens. They have two methodologies: by yield and by area. If calculated this way, the statistics are close (yield of 12-15 tons per hectare, while in the EU it is 40 tons). But there hasn’t been a million hectares for a long time – grandmothers and grandfathers don’t plant. Keep in mind that these people are dying, and the youth don’t want to plant. Drive through the villages and see.
— According to official data, the total harvest is 20-23 million tons, but what do you estimate it to be?
— I think we are growing about 10 million tons.