Automatically translated version. May contain inaccuracies compared to the original.
Two sugar factories of Petro Poroshenko (LLC “Food Company Zory Podillya” and PJSC “Food Company Podillya”) received a record domestic quota for sugar sales in the 2015/16 marketing year. In total – 269 thousand tons. Or 15% of the overall quota for all producers, which this year amounts to 1 million 720 thousand tons. This is reported in the segment by Alisa Yurchenko in the program “Our Money” (ZIK channel).
Only six plants of the Astarta-Kyiv group of Victor Ivanych and Valeriy Korotkov received a larger quota than Poroshenko’s – 353 thousand tons.
Such a quota volume indicates growth of the presidential business. After all, according to the National Association “Ukrtsukor,” last year Poroshenko’s plants produced 220 thousand tons and were third among all producers. If this year the production of the president’s plants reaches the quota volume, they will contend for second place among sugar producers. SKRN2
Until this year’s record, Poroshenko’s plants received their largest quota in the 2013/14 marketing year. Its total volume was 204 thousand tons or 12% of the season’s overall quota. If you compare this year’s quota with last year’s, Poroshenko’s plants’ quota grew by about 5%, while the national total decreased by the same amount.
As a reminder, Petro Poroshenko promised to sell his business while introducing “new traditions” in the country, but this promise has not yet been fulfilled.
Quota “A” is the maximum amount of sugar that the state allows to sell domestically during a marketing year. The key function of quotas is to curb sugar overproduction, which affects the selling price.
Quotas among sugar producers are allocated based on the results of two commissions. One checks the technical readiness of factories for the sugar season, visiting each enterprise. This commission includes representatives of the Ministry of Agrarian Policy and Food and representatives of the Association “Ukrtsukor,” which unites all sugar factories in the country. The other commission directly distributes quotas taking into account the conclusions of the technical commission. It includes representatives of the Ministry of Agrarian Policy, the Association, and two specialized institutes.
According to the protocol of the meeting of the competition commission for quotas distribution from 14 May 2015 r, a copy of which is in the Our Money’s possession, this year sugar producers submitted applications for 2 million 100 thousand tons of sugar. Several factories were denied quotas based on the technical commission’s checks. Since the total quota for this year was still smaller than the sum of the remaining applications, everyone else’s requested quota was reduced by the same coefficient.
Currently, at the Ministry of Agrarian Policy, as well as at the level of parliament and the cabinet, there are two competing concepts. The first is a complete rejection of internal sugar market quotas, since the ineffectiveness of sanctions for quota violations allows unscrupulous producers to sell more than the norm on the domestic market. Therefore the quotas harm honest producers, while they fail to perform their key functions – fighting overproduction and preventing sugar plant bankruptcies. The minister of agrarian policy Oleksiy Pavlenko voiced this year’s proposal to abandon quotas. It is supported by middle and small producers and some ministry officials. The second concept is a complete concentration of quota distribution functions among producers in the Ukrtsukor Association. That is, the Ministry would be excluded from this process. This idea is supported by the Ukrtsukor Association, some predominantly large producers, and some representatives of the Ministry.
As a reminder, in 2013-14 years the tax authorities, based on audits, assessed the group “Roshen” of Petro Poroshenko with more than 100 million UAH in taxes and fines. After Viktor Yanukovych’s escape, most of the lawsuits concerning these tax reassessments were won by companies from the Roshen group.
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