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Major Ukrainian edible oils and agribusinesses in Ukraine including Kernel, ADM and Nibulon have suffered substantial losses as a result of the ongoing conflict with Russia, according to a report by the United States Department of Agriculture (USDA).

“[While] a worst-case scenario was avoided, the Ukrainian economy suffered significant damage. Although agricultural production in Ukraine remained significant, many producers declared substantial losses and are struggling to stay afloat,” the USDA said in the 24 April Foreign Agricultural Service (FAS) report.

For example, the world’s largest sunflower oil producer Kernel Holding – with 8% of world market share – and also Ukraine’s leading grain and oilseed exporter and producer declared a loss of US$41M in its 2021/22 report, the USDA said. This figure was a significant drop compared to its US$553M profit the previous financial year.

The company had lost access to some of its assets in southern Ukraine and was unable to use Mykolaiv seaport for sunflower oil exports, the report said. In January, Kernel acquired an oil terminal in the port of Pivdennyi (Odessa Oblast) to compensate for the lost access to its old export hub. The company’s revenues in 2022 dropped by 5% to US$5.3bn.

Kernel withdrew its shares from trading on the regulated market operated by the Warsaw Stock Exchange in April, the report said.

In 2022, ADM Trading Ukraine – a subsidiary of global agribusiness giant Archer Daniels Midland (ADM) – reported a huge revenue drop of UAH13.7bn (US$384M) to UAH 25.1bn (US$705M), resulting in a notable UAH1.6bn (US$45M) loss, the report said. In 2021, the company had reported a profit of UAH 375M (US$13.7M).

Although the company continued to operate its oilseed-crushing facility in Chornomorsk and port grain elevator in Odessa, it had lost control of two facilities in occupied territories (as of December 2022).

ADM-Ukraine operated six elevators in southern and central Ukraine. After the war started, the company re-routed its exports through the railways. ADM also resumed grain exports through the Black Sea grain corridor when it opened at the end of July 2022, the report said.

Global agribusiness giant Bunge Ltd had to absorb the loss of its Ukrainian subsidiary – Suntrade/Bunge Ukraine. Last year, its revenue dropped by UAH 20bn (US$562M) to UAH13.6bn (US$382M), generating a net loss of UAH1.8bn (US$51M).

In 2021, Bunge Ukraine was the second largest player in the Ukrainian sunflower oil crushing sector.

However, after start of the war, the company was unable to operate its Mykolaiv port-based oil extraction and grain export facilities as Mykolaiv port remained outside the grain deal allowing limited grain exports, the report said.

The company’s inland elevators and another oil-crushing facility in Dnipro remained operational.

Of all the losses, Ukraine-based agricultural producer and trader Nibulon was likely to have suffered the most and was now struggling to stay afloat, according to the report.

The company’s revenue dropped from UAH40.6bn (US$1.49bn) in 2021 to UAH15.2bn (US$0.43M) last year.

The company was unable to use its main export hub in Mykolaiv seaport. In addition, the company’s founder Oleksii Vadaturskyi was killed in a missile strike in Mykolaiv, the report said.

The 2022 net loss amounted to UAH10bn (US$280M). Although the company’s recently acquired terminal in Izmail river port had lifted its operations, the company announced a technical default at the end of 2022.

Nibulon’s debt is estimated at US$573M with 26 western and Ukrainian banks, investors and international institutions, according to the USDA report.

Total agricultural industry loss in Ukraine last year reached billions of dollars, undermining the industry’s resilience in 2023, the report said.