Farming

ESV has long experience of farming in Ukraine. The country lacked investment during its time as a member of the USSR and only after 1991 did western capital enter the country to boost agricultural production. As a result, many farms now are able to utilise efficient modern tractor seed-drilling and harvesting equipment. However, many of even the most modern farms still largely rely on Soviet-era silos for grain processing and drying and are reliant on aged railway infrastructure.

A purchase agreement with Agri-Ukraine, Cyprus (“Agri-Ukraine”) has been agreed, whereby ESV has an option to purchase the whole of the grain and seed throughput business of Agri-Ukraine for a period of ten years from 14 June 2006. The value of the grain and seeds handled through the infrastructure of Agri-Ukraine is expected to be in excess of US$4 million per annum over that period. The Directors of ESV believe that as a result of ESV’s international trading contacts, ESV can achieve higher prices for the grains and seeds than Agri-Ukraine has in the past. The fee for the purchase and resale by ESV is agreed at 10% of the turnover.

 Agri-Ukraine has been farming approximately 12,000 hectares of leased land in Ukraine for eight years. Historically, crops have consisted of sunflower seeds, wheat and maize, with barley, oil seed rape, sugar beet and soybean as rotation crops.