EMPIRICAL ANALYSIS OF EXPORTS OF ORGANIC AGRICULTURAL FOOD PRODUCTS OF UKRAINE

Abstract

The main goal of the study is to identify endogenous and exogenous factors that determine the scale and dynamics of Ukraine’s exports of organic agricultural food products (OAP). The formulated goal caused assessment of a number of potential factors influencing the development of the export potential of the Ukrainian agro-industrial complex in terms of production and sales of organic agricultural products on foreign markets. The authors conducted economic and mathematical modeling based on the software product E-Views. The observation interval covers 2008-2019. Multifactorial regression model has been constructed and tested for heteroscedasticity, as well as causal relationships have been identified between the main indicators of supply and demand and the exports volumes of related organic products. This makes it possible for further forecast on Ukraine’s exports in the short and medium term. Methodology. The study has been based on statistics from international and Ukrainian institutions specializing in organic farming and trade, including FiBL (Research Institute of Organic Agriculture), the Federation of Organic Movement of Ukraine. Databases of the State Statistics Service of Ukraine, UNCTAD for the period 2008-2019 were also involved, which made it possible to conduct a full cycle of research procedures in order to identify the most significant factors influencing Ukraine’s export activity within related segment of the global market. The results of the conducted modeling show the following: achievement and increase of Ukraine’s relative advantage in international trade of organic agro-food products for the outlined years; the existence of strong connection between the volume of exports of organic agro-food products and the level of comparative country’s advantages in international trade; identifying a significant impact on exports of endogenous factors, namely the level of wholesale and retail sales on the domestic market of Ukraine as a factor that creates additional demand from the population and business of Ukraine (B2B and B2C markets) for organic products and enhances the attention of agricultural manufacturers to activities that combine the criteria of high profitability and public demand. Another endogenous factor is the volume of areas allocated for organic farming has shown insignificant impact, however, it allows to create resource conditions for increasing production and export activity of national business in a particular sphere on various directions, from meat and dairy products to production of organic fruit, vegetables, etc. Practical implications. Conceptual provisions, conclusions formulated by the authors based on the conducted econometric modeling, allow to optimize the measures of regulatory policy in terms of institutional support of conditions and factors contributing to promising activities of the national agro-industrial complex. This will ensure the implementation of the national strategy on sustainable development with its emphasis achieving environmental criteria of production and consumption, reduce the level of import dependence upon a number of strategically important food groups and, at the same time, increase economic efficiency of Ukrainian agricultural business. Value/originality. Prospects for further research in this area may assess the potential of international production and marketing cooperation between Ukrainian agricultural companies and non-resident companies in terms of limiting the latter’s access to the land market in Ukraine while finding flexible mechanisms to stimulate joint production and sale of organic agricultural products on international markets according to quality and safety standards.