Problems of state regulation of agriculture of Ukraine

Abstract

The problems of state support of agriculture of Ukraine are analyzed. Scientific publications are dominated by criticism of existing support systems without conventional approaches to improving it. Even the interpretation of the concept of “state support” is debatable. The development of state support programs is complicated by the unformed market environment, the high level of monopolization of the agricultural procurement sector, and the difficulty of bringing small producers to target market segments. It is concluded that because of this, the possibility of creating private farms without their registration as legal entities is not realized. There has been a tendency for the emergence and accelerated development of particularly large farms focused on production for the export of raw materials while aggravating the social problems of the village. Only by government support will the negative trends in cattle reductions be offset. It is proposed to increase the effectiveness of state support programs by creating self-regulatory vertical marketing systems, in which the interests of all participants of these systems, ensuring their sustainable development, will be coordinated without direct state administrative intervention. Organizationally, it is easiest to create vertical marketing systems based on the initiative of existing processing plants, for which this is a way of procuring the required amount of raw materials with specified characteristics. Such raw materials can produce competitive products both domestically and internationally. Public financial support for such systems will ensure that their processes of origin and development are intensified. The organization's discussion on the cooperative principles of small processing is critically evaluated. It is shown that the main advantage of organizing such processing is to overcome market monopolization, to ensure without price interference stabilization of prices and their formation at a level acceptable to all members of the cooperative association. The risk of expected price uncertainty is reduced and bank loans may be attracted accordingly. Business plans for the development of individual enterprises and industries can be developed based on the expected price. The development of state targeted programs for agricultural development is simplified. Direction of state targeted programs of agricultural development and achievement of strategic goals, orientation to the data of the purpose of individual economic entities implies constant research and forecasting of market trends. Even large agricultural enterprises or business associations cannot carry out such research on their own. They provide for taking into account the expected values of macroeconomic indicators, and taking into account the international integration of Ukraine and the situation of the international market. Such research by state institutions, dissemination of information on the results of research, bringing information to all participants of the agrarian market is more important state support than direct state financial support.