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Losses of the Ukrainian agricultural sector due to the Russian invasion reached $80 billion – KSE

The Ukrainian agricultural sector, as of December 31, 2023, suffered more than $80 billion in direct losses and losses as a result of the full-scale Russian invasion. This is stated in a study by the Center for Food and Land Use Research (KSE Agrocenter) of the Kiev School of Economics (KSE).

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In two years after the invasion, the total damage amounted to $10.3 billion, which is 18% more than in the previous year. The relatively moderate pace of this growth is explained by the fact that a significant part of the assets in the regions where ground battles are ongoing had already been destroyed in the first year of the invasion.

The three regions that suffered the greatest damage are Zaporozhye, Kherson and Lugansk regions, which account for 65% of the total loss.

Damaged and destroyed agricultural machinery constitutes the largest category of damage, totaling $5.8 billion. About 181 thousand units of agricultural machinery and equipment were partially or completely damaged.

Experts estimated the damage caused by the theft or destruction of already produced products at $1.97 billion, damage due to damage to granaries – $1.8 billion, damage to perennial crops – $398 million, livestock – $254 million, aquaculture and fisheries – $35 million.

Indirect losses

< p>In addition to damage due to damage and destruction of physical assets, Ukrainian agricultural producers face indirect losses caused by loss of income due to decreased production, lower prices and increased production costs.

In contrast to damage that is localized on territories affected by military operations, indirect losses are suffered by farmers throughout Ukraine. Total estimated indirect losses more than doubled compared to the previous review and amounted to $69.8 billion.

Losses due to decreased production

According to expert estimates, total losses due to decreased production in crop production amounted to $35.1 billion, due to a decrease in livestock production – $5.6 billion, due to a decrease in domestic prices – $24.1 billion, due to an increase in production costs – $4.4 billion.

Needs for reconstruction and restoration

KSE analysts estimated the total needs for reconstruction and restoration over the next 10 years at $56 billion. Priority needs for 2024, according to their estimates, will amount to $435 million, most of which are already covered by donor funding.

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