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Prospects of Ukrainian soybean on the market of the EU

Soybeans have been the world most important agriculture crop for many years. They are grown on every continent and they are the most common among oilseeds crops and play a crucial role in the grain, food and feed balances in the leading countries. Significant protein content and a high energy value make soybeans an important ration component for all kinds of animals and birds. Soybean meal and soy cake are traditionally used in animal farming. However, significant attention should be paid to a relatively new product of processed soybeans a full-fat soybean.

Now Ukraine takes the eighth place in the world for growing soybeans with a leading position for production of sunflower oil and grain crops From 1990 to 2014 soybean production has increased by almost 40 times from 99 thousand tons to 3.9 mln tons. Since 2010 Ukraine takes the first place  among European countries and the CIS by production volume of soybeans.
The main factor of increased popularity of soybeans is an increased need of them as a feed for animals, which is a global trend. Nowadays almost 75% of the crop in the world is directed for these objectives.

Compared with the traditional export crops of Ukraine – maize, wheat and rapeseed – soybean is a relatively new export unit, sales of which brought more than 700 mln of USD in 2014. That year Ukrainian soybeans were in the greatest demand
in Turkey, Egypt, Italy, Greece, Iran and Spain. On the whole 1.7 mln. tons of soybeans were exported in 2014 and only
0,6 mln. tons of them were exported to the EU countries (35,3%).

Moreover, under certain conditions Ukraine is able to increase significantly the volume of export of soybeans to Europe.
In the EU the demand for GMO-free soy is steadily increasing. The key factors of the increasing demand of GMO-free soy
in the EU are its use for chicken and eggs production according to retailer`s requirements, a growing need for GMO-free feeds for dairy cows according to dairy companies` requirements, and to some extent the need for GMO-free feeds for pork production.

Of 15% (7 mln. tons) of EU`s demand in GMO-free soy only a third can be provided with domestic production. In the future Ukraine can be the main supplier of GMO-free soy to the EU market and it can provide 30-50% of such soybeans under the condition of solution of the problems  connected with transportation and possibilities of soybean processing. With the help of Ukraine all the demands of the EU can be satisfied by 2020.

To ensure certified and efficient production GMO-free soy producers and processors united in the association "Danube Soya", which has about 190 members from 16 European countries. But among the actual members of the association "Danube Soya" there is only one representative of agricultural soybean producers of Ukraine – the corporation "Svarog West Group", which became its member at the beginning of 2015. The membership in the association will enable the corporation to sell GMO-free soybeans at $ 20-120 per ton. It is more expensive than for genetically modified soybeans. At the same time, the capacity of the European market of GMO-free soybeans considerably exceeds potential abilities of the operator. In 2014 the corporation produced about 140 thousand tons of soybeans.

Ukraine is able to provide the delivery of products which are surely free from GMO or are not labeled as GMO, in accordance with the requirements of the European Union. It can be provided by using in its molecular-genetic laboratories the IP programs (Identity Preservation Program), which are a set of measures aimed to identify a cargo and to prevent its mixing with other parties of cargo at all phases of its transportation. There are several methodological approaches for determination of GMOs. They are a rapid analysis for presence of GMOs carried out by using test-strips, PCR analysis (classic PCR) and PCR in real time to determine the quantitative GMO content in agricultural raw materials.

The Berlin declaration adopted in the course of the X International Conference "GMO-Free Europe”: future opportunities and challenges" held on 6-8 May, 2015 in Berlin strengthened the principle of rejection from genetically modified organisms on the territory of the majority of EU members (and correspondently established the requirements to EU government about the opportunities to provide farmers with GMO-free seeds, pure areas for growing GMO-free products, and to provide consumers with labeling of GMO-free products).

The participation of agricultural producers in the association "Danube soy" can also help to increase their supply of organic soy on the EU market. Its cost is typically 50-100% higher than that of GMO-free soy. In the future Ukraine will have a great potential to become a main supplier of organic soybeans. At present, it comes mainly from China and the USA.

The Government of Ukraine and local authorities should strongly encourage the involvement of agricultural producers in the association "Danube soya", because the implementation of joint projects in this direction gives possibilities for both marketing development and European partnerships and for improving the standards and indicators of quality and safety of domestic products.

Keywords: market of soybeans, GMO-free soybeans, organic soybeans, export, association, EU market.

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