Quality and safety of Ukrainian grains are two major issues which make the agricultural product less competitive on the global market. Since the issue is under the state control in Ukraine, in particular the State Service on Food Safety and Consumers Protection, we asked the Head of the State Service, Volodymyr Lapa to tell us about the situation with phytosanitary and veterinary monitoring in Ukraine, and any expected changes.
- The State Service on Food Safety and Consumers Protection of Ukraine, and You as its Head, have already worked for 5 months. What tasks did You fulfill or almost completed, and what were the major problems?
The State Service on Food Safety and Consumers Protection was founded and actually started working in April 2016, which the decision to found the Service was taken in September 2014, but all organizational procedures took nearly 1.5 years. I started working at the Service in December 2015. Of course, foundation of the Service is quite significant result, taking into account such long time for organizational procedures. Provision of funding was quite difficult task, which was finally resolved with some delays. Moreover, a standalone solution funded monitoring of the residues of veterinary products, which is a string requirement for the exports of Ukrainian livestock products. Therefore, we managed to realize all necessary decisions on the funding within the budget plans in the current year. By the way, to date the officials are continuing the budget process for 2017. We expect for further financing and anti-epizootic measures, funds for laboratory researches, and payment of salary at the appropriate level. Of course, we understand that the country has quite difficult situation, but I think the majority of specialists and experts already realized that ignorance of basic security measures in the sphere of anti-epizootic and quarantine measures leads to mush more significant losses, including the budget.
Our plans include increasing the motivation of our staff, as it is hard to fight corruption when employees get salary at 1500-1700 UAH per month, and it is extremely difficult to get any effective work in such case. We mainly managed to realize the plans. We consider that it is better to have smaller number of highly-qualified specialists, and pay them respectable salary, as the issue of human capital is quite relevant in Ukraine for both business and public service. According to the plan, we organized a number of trainings – many thanks for support to our international partners, primarily the project of the European Union under the leadership of Tony Vila, which mainly included trainings on HACCP. We are planning to make a presentation of the results in October. The company SGS estimated our knowledge level, in fact, independently of the coaches, and we have really good results. Generally, nearly 75% of the employees, who passed the trainings, successfully passed the tests. In addition, we provide many various training, including anti-epizootic measures. We continue working to create more favorable conditions for business – we registered a draft law in the Verkhovna Rada on delegation of authorities in the sphere of phytosanitary control of non-government laboratories.
The web-site of the Ministry of Agrarian Policy posted a draft decree of the frequency of controlling at the border. In the nearest future, after discussions with business, we will form the final version of the document. Although, business has very ambiguous attitude to the document. Also, we were actively involved in finalizing the draft law #0906, especially in the part where it comes about the need for a document of the competent state body for imports of the products of non-animal origin.
Also, we are completely prepared to work in the format of single window. We put into the system nearly 800 inspectors, who are ready to work in all three directions: phytosanitary control, veterinary control, sanitary control in all oblasts of Ukraine. I can not say that everything is going well, in particular, previously we planned to ensure videotaping of the monitoring process. But it is not so easy to find the necessary funding. In the future - improving the cattle identification system and many other issues.
Another one of the fundamental issues - public purchases. We switched to ProZorro system, which saves nearly 20% of the budget funds.
- To date, the issue of phytosanitary condition of fields in Ukraine is quite topical. According to the latest data of the State Service on Food Safety (late August) after monitoring of crops in nine oblasts of Ukraine, to realize the required phytosanitary protocols and inspection requirements for the exports of barley, soybeans and corn from Ukraine to China, the samples contained the quarantine objects, prohibited for exports to China. What is the real situation at Ukrainian fields?
I should say that some Ukrainian mass media provided not correct interpretation concerning the ban on grain exports. There is no ban on grain exports to China, we are talking about our own limitations: the fields where we find the quarantine objects that do not meet the Chinese phytosanitary requirements, will be localized, and we will provide the ability to export crops from those areas which are not damaged by such objects. Moreover, if we had not realized such work, we would have received the mismatch facts directly from China, but it would be much worse. Unfortunately, we have already received one notification from China. There was a corresponding discussion in the working group meeting in the Ministry of Agrarian Policy. Of course, we understand that there is a liberal business environment, and do our best to meet them. But there are international commitments of the country, and we will do our best to adhere to them.
At the same time, the requirements of different countries are quite different. If, for example, Egypt and Israel have zero tolerance for ragweed, but Southern Europe accepts grains with ragweed, and the task is to supply grains on the required markets, and meet the phytosanitary requirements of every specific country.
- Each cargo lot of exported grains passes through the required laboratory tests. Have You previously faced the problems arising in the current year? Were there any claims about the presence of quarantine objects in grains from other countries, except for China?
In fact, problems continued accumulating systemically. There are certain measures for deregulation, and there was the moratorium on inspections. I am not the adept of constant inspections, but their absence demotivates the market. Indeed, when there is the systemic disturbance, some deliberate violation, then the economic entities must bear responsibility. Theoretically and practically, the turnover of quarantine objects should be banned. First, we need to locate them, but then we should use administrative resources, regulatory functions to influence at those companies who continue distributing such objects in Ukraine. It is true not only for phytosanitary parameters - diseases, pests, weeds - but also for GMOs. It is no secret that there are no GM varieties registered in Ukraine, but these products still appear on the market from time to time.
I think we will come to such option, perhaps next year, when the one who deliberately violates the law, will bear responsibility. It is not correct to do such steps in relation to the already-grown crops, but we will make such measures in 2017.
As for the claims from other countries, mainly Indonesia has certain claims on smut, there were some claims from other countries (such as ragweed, ergot, etc.). Unfortunately, we faced serious increasing of the number of notifications, due to a change of the controlling state bodies, but only partially. For example, as for Indonesia, Ukraine did not export its agricultural products to the country in previous years. In fact, Indonesia sent 35 notifications during two recent years. Except for Indonesian claims, the statistics of notifications almost halves. But Indonesia is a new market for us, and we need to learn the new requirements. Naturally, there are new challenges, and we must be ready as the state body, but also the business must be ready.
- According to many experts and market participants, Ukraine is threatened with possible loss of the image of the global supplier of high-quality and safe agricultural products. African swine fever outbreaks and phytosanitary condition of crop fields jeopardize the exports of feed grains from Ukraine, and the export forecasts of corn in the new season are not optimistic. What is Your opinion on the current situation, and how realistic are the fears of market participants?
As for the phytosanitary direction, we will break all records for exports. I think that the buyers are not unreasonable people, and they would not have purchase our crops if there were doubts in the image of Ukrainian products. Of course, it is hard for us to compete, the market is always difficult when the grain prices fall. When the grain prices are high, the number of notifications is quite small, as they want to buy anything, just to get it cheaper. When the grain prices are low, then every country begins applying to its phytosanitary condition and other safety indicators. Of course, there are many objective things that I mentioned above, and we understand that we need to adjust them.
As for the animal health direction, most countries refuse to purchase Ukrainian pig products, although we are trying to enter many markets. Of course, in terms of the current epizootic situation with African swine fever it is more dream than reality. First we have to do our homework, and then dream about the global market. Unfortunately, it is a fact. We need to keep the situation under control, it is more realistic challenge than working with the export market.
