Ministry of Agrarian Policy urged retailers and producers to share losses from Russian attacks

Retail chains and food suppliers in Ukraine must jointly distribute financial losses due to the destruction of goods and warehouse infrastructure as a result of Russian attacks. Until the launch of a full-fledged war risk insurance system, there will be no universal mechanism for compensating such losses.

This was stated by Minister of Agrarian Policy and Food Taras Vysotskyi during a conversation with journalists.

According to him, placing all losses only on the producer or only on the retail chain is wrong. The conditions should be determined separately for each product group and specific case, taking into account logistics, marginality, and the stage of supply at which the goods were lost.

"There cannot be 100% coverage of losses at the expense of the producer, just as there cannot be 100% at the expense of the seller. This should be divided into logistical stages and discussed, taking into account the share of profitability, margin, of each type of product", noted Vysotskyi.

The Ministry of Agrarian Policy, according to him, supports negotiations between retail chains and suppliers so that the parties can agree on the distribution of losses individually.

The government considers a national war risk insurance system, which the Ministry of Economy is working on launching, as a long-term solution to the problem. Vysotskyi noted that after its full launch, losses from war risks could be covered by insurance, and businesses would not have to determine each time who exactly bears the losses.

Losses from strikes on warehouses can be measured in billions

According to the minister, strikes on food warehouses occurred throughout the entire period of the full-scale war, but after the massive attack on August 5, their intensity became the highest since the beginning of the invasion.

The largest amount of warehouse infrastructure by area was destroyed in Kyiv region, where a significant part of the capacities for supplying the capital is concentrated. Warehouses in Dnipropetrovsk region also suffered significant damage.

Companies have not yet completed loss assessment. According to estimates that Vysotskyi provided to journalists, one large-scale strike on large warehouse facilities can cause losses of 3-5 billion UAH, and the total losses of businesses from such attacks can already be measured in tens of billions of hryvnias. Final figures will appear after the completion of loss recording.

In parallel, businesses are rebuilding logistics, moving from large centralized warehouses to smaller and more dispersed facilities, as well as to more direct supply from producer to retail outlet.

Separately, the issue of relations between suppliers and retail chains can be regulated by draft law No. 6068-d on protection against unfair trade practices. The document has already passed the first reading, and the Ministry of Agrarian Policy supports its further consideration.

Based on materials: AgroPortal, Ministry of Agrarian Policy and Food of Ukraine