Kernel, one of the largest Ukrainian agrarian groups, will continue to develop cooperation with agricultural companies under the Open Agribusiness partnership program; by 2025, the total land bank of the program participants is expected to reach 500,000 hectares, project manager Serhiy Viter said in an interview with Interfax-Ukraine.
"The project development plan is ambitious – by 2025 we see 500,000 hectares in the project. Today there are very different companies in the project, there are about 15 legal entities and there are groups of companies, when one owner has several companies. There are companies with land banks of 1,000 hectares and with 20,000 hectares. Companies are entering the project with different goals," he said.
According to the project manager, the Open Agribusiness perpetual program started in August 2019, and initially obliged a partner included in the program to sale a 10% stake in its charter capital to Kernel, and the transaction sum was directed to the development of a partner company. According to Viter, in September 2020, this norm was made optional, and now agricultural enterprises are joining cooperation both with the condition of 10% redemption by Kernel, and without it.
"As of September 2020, some 33,000 hectares [of the total land bank of participants] were under the program of 10% portfolio investment, today – more than 70,000 hectares. Now we are considering potential participants with a total land bank at the level of 20,000 hectares, the companies are being worked out and their financial statements are being checked. The target for the current marketing year, which will end on June 30, is 80,000 hectares, and I think we will fulfill it," Viter said.
According to Kernel, the Open Agribusiness perpetual program allows agricultural producers with a land bank of 1,500 hectares to receive loans and participate in Kernel forward programs, buy inventory together with an agricultural holding, organizational and agronomic support, as well as financing for the purchase of land. A partner undertakes to supply at least 80% of its crop to Kernel in return.