Ukraine: Water along the Food Chain, March 2017
15 March 2017
Focus on the dairy industry
With the vast extent and productivity of its rich soils, Ukraine is one of the “breadbaskets of Europe”. More than 56 percent - nearly 340 thousand square kilometers - of the country's surface area can be classified as arable land.
Since the availability of water is a key factor to sustain agricultural development, FAO and the EBRD have taken a look at the country’s water supplies in a new study - “Ukraine: Water along the Food Chain” - prepared under the cooperation program between the two institutions.
The study found that the country’s water balance, after all uses: “...is positive for renewable surface waters. However, at the current level of withdrawals, water balance for internal groundwater resources - although positive - is more limited.” These circumstances underline the growing importance - and the opportunity - of reinforcing sustainable and efficient water use in Ukraine's agriculture.
Saving water and limiting carbon dioxide emissions at the same time
The authors of the report further found that: “The output of rain-fed agriculture in Ukraine, given its specialization towards grains for food, feed and oil purposes, is still sufficiently cost-effective, while substantial rehabilitation and renovation of irrigation investment not an immediate priority. " Instead, they recommend the wider adoption of “climate smart” practices such as no-till agriculture – also called conservation agriculture – to help stabilize the structure and humidity of soils and therefore limit the use of irrigation water.
In view of Ukraine’s agricultural production systems, the adoption of climate smart techniques such as conservation agriculture should be an area of priority investment. FAO Senior agronomist Turi Fileccia explains why:
“No till maintains the humidity of soils and, as such, limits the need for irrigation. But importantly, as a sink for CO2, it has a wide range of climate benefits. Applied on a major scale, it can help control global warming. Tillage being the most energy intensive farming operation, by not doing it, farmers can save between 30 and 40 percent of the effort and, in mechanized agriculture, the fossil fuels.”
The Dairy value chain - Ukraine's prime food industry groundwater user
As a way of assessing agricultural water consumption in Ukraine, the study closely examined the dairy sector, in part because it offers the strongest rationale for water-use improvement, with high potential positive returns both in environmental and economic terms.
The country is a net exporter of milk and milk products, although its trade balance in this sector has shown negative trends following independence. The production of milk declined constantly from 1991 until 2011, as Ukraine lost traditional markets in the former Soviet Union. In 2012, production finally showed signs of recovery, with commercial milk producers actively investing in larger dairy herds and modern technologies.
“Ukraine is not utilizing its huge potential in the dairy business, given the availability of inexpensive feed, vast land resources, educated and inexpensive labor and relative proximity to key markets,” said FAO economist Andriy Yarmak, “There is a lot of room for sustainable growth. Optimizing the use of natural resources like water is part of the equation.”
In dairy processing, water is mainly used for heating, cooling, washing and cleanup. While water fees in Ukraine are not high and their share in the total costs of production is relatively low, these costs are rising and some dairy plants have already started looking for ways to improve water efficiency.
The authors of the FAO/EBRD study consider that the dairy industry is the prime groundwater user within Ukraine’s food industry, accounting for about 26 percent of all food industry water-use. It is therefore where most water savings could be achieved.
Transitioning towards more commercial and more efficient dairy production
In the authors’ view, one key issue is the delicate transition from a household-centred milk production to one that is more commercially oriented, a transformation that will require investments and organizational changes to move towards a modern dairy sector that will also pursue improved water efficiency.
See full report here