Ukraine is a lower-middle income country in Eastern Europe. Its economy is rebounding after the political and economic turmoil of recent years. Ukraine’s imports of agricultural products grew over eight percent in the first ten months of 2019. As a major agricultural producer and exporter, Ukraine also possesses a large food-processing industry. The majority of agricultural import growth in the near future is likely to concentrate in food ingredients. Economic growth in Retail, Hotel, Restaurant and Catering sectors is opening multiple niche opportunities for U.S. higher value-added products. Trends for Western-style food are profound and can spell more imports in the near future.
Ukraine is a good market for U.S. food exports, such as frozen fish and seafood, dried fruits, nuts, cereal products, snacks, beef, food ingredients, and other prepared food products. There are emerging trends in urban areas and niche products that currently sell in small quantities, but have significant future sales potential. Demand for healthy, organic, and/or natural foods is increasing. Demand is growing for niche products that target specific health issues, such as diabetes or celiac disease (gluten-free food). Likewise, demand is growing for vegetarian and vegan products. In urban areas, high quality and high-end food products have demonstrated an increase in sales and significant future prospects. Seafood, high-end alcohol products and quality beef products have also been expanding their market share.
Ukraine is typically referred to as a “high risk – high reward” country for international businesses. A turbulent political environment, exchange rate fluctuations, revolutions, on-going conflict with Russia-backed separatists in the east, widespread corruption and the uneven pace of economic and legal reforms make it a challenging place to do business. To minimize risks, the majority of U.S. exporters rely on their Ukrainian partners for issues on the Ukrainian side of the border: customs and food safety clearances, in-land transportation, storage, product placement, marketing, promotion etc.