Ukrainian grain exporters agree on VAT refund

Grain exporters to the Ukrainian market agree on VAT refund with the bonds of the domestic government loan, under the terms that their profitability will not become lower the market cost.

According to Klimenko, operators of the grain market complain on the absence of true and full information regarding the planned VAT refund with the obligations. Klimenko noticed that the government should discuss problem of the VAT refund together with participants of the market.

The decreasing of domestic prices would be the reason that grain producers may loss about UAH 10 billion (US$1.26 billion) due to the VAT problems. Most of the grain exporters will conclude solely currency contracts, some will export grains through the agrarian companies, which have various VAT privileges.

According to Sergey Stoyanov, the Director of Ukrainian Agrarian Confederation, the carry-over stocks as of July 1, 2010, will be rather high at the level of 4.8-5 million tonnes.

In 2009, Ukraine produced nearly 46 million tonnes of grains and leguminous plants in clean weight, a decrease of 13.7% compared to 2008. Previously, Nikolay Azarov, the Prime-Minister, announced that the internal governmental bonds issue for the VAT back-payment would have start in May 2010.