By: James Hydzik
Beekeeping looms large in Ukrainian society: one in nine Ukrainians keep hives.
The Ukrainian Orthodox Christian church calendar includes Medovyi Spas, or “Honey Saviour”, on August 14th, and honey fairs spring up throughout the country in the second half of August. Ukrainians have also contributed to apiculture worldwide, with Petro Prokopovych generally recognized for creating the modern frame hive in 1814.
The 20th century was a quiet time for beekeepers. “For the last 80 years we lived behind the Iron Curtain and we didn’t see much,” says Vitalii Nagorniuk, Vice-President of the Apiculture Union of Ukraine. Beekeeping remained primarily a backyard occupation in the heavy-industry oriented Soviet era. Even after independence in 1991, commercial honey production suffered. Grain crops were in focus, and commercial production fell 5.3% over 2000-2004 to under 1,000 tons. By 2012, total exports reached 13,338 tons. This skyrocketed to 57,000 tons in 2016 according to the State Statistics Service of Ukraine.
So the question comes almost automatically: “How does a country with so little commercial production in 2004 export so much honey by 2017?”
With almost five million bee keepers in the country, the lack of commercial production for export did not mean that there was no honey in the country. Ukrainians eat over a kilogram of honey a year, which equates to over 40,000 tons for domestic consumption alone. The first step to making more honey, namely scaling up, was obvious.
As such, honey has been an export commodity for Ukraine since independence, despite the rather small volumes in the beginning. The problem with exports even after the first 10 years of independence came down to the export chain and the lack of industrial production and control. Still, the country was well positioned to replace Chinese honey after the latter was banned from the European Union in 2002.
“When I started looking at the Ukrainian honey market in 2004, there were only three or four companies able to export. That compares to now, when there are about 50 exporters on the market,” says Sébastien Pou, Senior Purchaser at Odem, which was the first to introduce Ukrainian honey to the Canadian market. “In 2004-2006, there were issues with antibiotics, but that’s not the case anymore. In the past three or four years in particular, there’s been a push for quality and a push for EU standards.”
There was a view of bees as “tiny chickens to be stuffed with antibiotics” that could be found in the early 2000’s, but it never really took hold among beekeepers. Export concerns aside, Ukrainian consumers often buy their honey at fairs and are accustomed to tasting the honey before they buy it, and some will spend hours finding the honey they think is purest and best tasting. And with households, especially in poor villages, accounting for 98.5% of honey production in 2014, the mass use of antibiotics is hard to achieve.
However, a similar problem, namely the use of fertilizers and pesticides on crops, was and still is a concern. Viktor Pohorilyi, Agrochemical Committee Coordinator at the European Business Association in Ukraine, points out that up to 25% of the crop protection chemicals used in Ukraine are illegal, and that some mass bee die-offs have been blamed on illegal pesticide use. However, no government assessments have backed up those claims.
The bigger issue seems to be one of coordination. Viktor Pohorilyi notes that, “when it comes to local communities and specific cases, it is not fully clear how to form a workable communication link between beekeepers and commercial farmers. Thus, each local case depends on certain personalities, which consequently can result in differing outcomes.”
Recently, the Ministry of Agrarian Policy and Food of Ukraine has established a working group on beekeeping that includes representatives from the relevant state authorities, beekeepers, farmers and NGOs. In our opinion, such a working group will become the first efficient model of communication between all stakeholders. Later, this model could be rolled-out to develop local communication.”
Anatomy of a commercial operation
While commercial enterprises still make up a small proportion of Ukraine’s beekeepers, they are present and growing rapidly. Vitalii Nagorniuk’s company, Apis Ukraine, is one such operation. Located outside of the village of Khalep’ya, south of the capital Kyiv, it currently has 2500 colonies and sows 123.5 acres, primarily with phacelia tanacetifolia. He explains that his operation is the result of five years of research worldwide and another five of construction. “I went through Europe, the USA, and Canada to cherry pick best practices that could be adapted to conditions here in Ukraine.”
Unlike Ukraine’s crop sector, much of which was originally saddled with unmaintained Soviet-era infrastructure, the lack of previous development in apiculture has helped (or forced) the move to the latest technologies. As a result, uncapping lines and an extractor from Finland are mated to a closed-circle extraction process based on what Vitalii saw in Canada. All work together with a closed-ended Ukrainian wax line.
The line between local and imports is blurred at times. A Ukrainian-built machine may well have German cutting parts on it. Also, “we use food-grade 52 gallon barrels for shipping bulk honey,” says Vitalii Nagorniuk. “A German manufacturer opened a plant here, so the barrels are locally produced to EU standards.”
And then there is the lab.
“The laboratory here is my eyes and ears,” says Vitalii. “The pollen analyzer here was obtained with assistance from the Japanese government. We have our own spectrum analyzer as well, and we can detect 12 different kinds of antibiotics.” Few companies in Ukraine have their own labs, and his is used for internal quality control purposes. “Ukrainian honey for export is analyzed by Intertek or QSI, as buyers know them. However, our State authorities have a monopoly here on testing for both heavy metals and radiation.”
Quality and how to keep it
Quality control is not far from producers’ minds, especially after an incident in Czechia (the Czech Republic) in 2016. Three companies’ export licenses were temporarily withdrawn after anti-microbial agents were found in their products. But does it signal that there is a broader issue with Ukrainian honey?
“We can have problems at the moment with smaller producers, who are sometimes not able to invest in proper production or processing facilities,” says Olga Trofimtseva, Deputy Minister of Agrarian Policy and Food of Ukraine on European Integration. “But when you take into account how much honey that we are selling constantly to the European Union, and that we’ve had only one such case, I’d call that a sign of success. It says a lot about the certification system and that the self-certification and self-control of producers and mostly by the exporters is working very well. And here – compared to the grain market or other commodities markets – it’s rather small, so the players know each other and that means that if someone is playing with his reputation, then he’s in danger of losing it all.”
Aligning Ukraine’s honey-related industry and legislation with EU standards is a requirement of the Deep and Comprehensive Free Trade Agreement that went into effect in 2017. This includes sanitary and veterinary norms. However, the alignment also needs to be in terms of, well, terms. “We should change a lot of things regarding terminology, the marking of the products, the main characteristics and the identification of the product regarding the main constituent. These are implemented by EU directive, and we are to implement them in Ukraine,” says Olga Trofimtseva.
Although the ministry has created the working group, the focus on bee keeping could be higher. “There are 3.5 million sheep in Ukraine, and seven ministry employees dedicated to their oversight. We have 3.5 million bee hives, and not one person in the ministry who is responsible for this branch of agriculture. And the price of one sheep equals the price of one bee hive,” says Vitalii Nagorniuk.
While the stick of industry self-policing and the carrot of exporting a proper product are doing well to keep the majority of market operators honest, it will probably take government to engage in some of the improvements that will take the industry to the next level. Along with removing illegal pesticides from the ag market, better communication, EU-standard labelling and specialized testing, Vitalii Nagorniuk sees deeper involvement by wholesalers in the production chain as a necessity for improving Ukrainian honey, and one that needs to be brought out through legislation. “It’s my belief that every exporter should also be a beekeeper,” he says. They should do more than buy and sell, but also work in the industry as well. That would be the minimum legislation.”
As Ukrainian producers increase the availability of an ever-more desirable product, there is the question of what will happen next.
“Five years ago, I wrote an article saying that Ukraine can potentially export 110,000 tons of honey, they laughed at me. You also have to take into account that Ukrainians like honey, too, and eat on average over a kilogram of it per year. That’s over 40,000 tons. We also exported 57,000 tons last year, and that’s just exports. But 40,000 tons for domestic consumption and 100,000 tons for export is a possibility. More large producers are coming onto the market, and that’s good,” says Vitalii Nagorniuk.
Reaching those quantities will require the emergence of new large-scale players on the market. Some of this will have to come through a thinning of the number of commercial producers. “There needs to be some market consolidation in some form, so we can form batches, so we can invest in some processing, and in high standards or trademark development,” says Olga Trofimtseva.
As for new markets, Ukrainians do look at North America, with its substantial Ukrainian diaspora in Canada and huge consumer market in the U.S. But can Ukrainian honey make further inroads there?
“I would advise Ukrainian producers to focus on Europe first,” says Sébastien Pou. “Ukrainian honey needs to come in at about $300 per ton less than Argentinian honey to be of interest. And since the North American market sees honey as a sweetener, they are more price conscious about honey than Europeans, who view it as a health food. Moreover, when prices are low, as they are now, the packers prefer to support domestic producers.” Sébastien sees Ukrainians exporting at most 500 tons to Canada in 2017.
Currently, 70% of Ukrainian exports go to the European Union, and most of the rest to North America (about 33 million pounds in 2015). Part of that is related to the types of honey Ukraine produces. Sébastien Pou notes that “Much of what Ukraine produces is sunflower honey with a lower fructose/glucose ratio. It crystalizes faster than other honeys and it’s not what is desired on some markets.”
Furthermore, there is a substantial amount of rape grown in Ukraine, but it is of a type suited for making vegetable oil. “If farmers planted rape for grain consumption, then that honey would be of interest to the market,” says Sébastien Pou. However, given farmers’ preferences and the lack of priority on bee keeping in the government that could make an incentive for farmers to change their crops, the chances of substantial increases in rape honey production are minimal.
Olga Trofimtseva sees two avenues for growth that Ukrainian producers should focus on. First, raising added value through moving further down the production chain, and with it, marketing. Ukrainian honey is exported in bulk to an EU country, then mixed with local honey and retailed as ‘a mixture of EU and non-EU honey’. “I really would like to diversify the honey exports in the sense that we produce their finished products. Our producers should concentrate more on processing and creating trademarks for their honey,” she says.
The other direction would be the production of organic honey. Both domestic and foreign demand is tremendous, and producers currently cannot match it. There has been assistance from the Swiss government to produce certified organic honey in the foothills of western Ukraine’s Carpathian Mountains, but quantities have been low. Certification is an issue, especially when the land needs to not have had crop protection chemicals applied for five years. Given Ukraine’s emphasis on grain agriculture and that the commercial production of honey often occurs in the same areas as commercial farming, then the lack of communication between the groups outside of some local attempts, combined with the lack of focus on such communication on the part of the government, makes the creation of substantial organic production a challenge.
If there are any clouds on the horizon for Ukraine’s bee keepers, though, they would be coming from the East. There have been whispers, started by the Argentinians or the Chinese themselves, that Ukraine’s rapid rise in export volumes came by transshipping Chinese honey. This particular threat is easily dismissed through testing, says Sébastien Pou. “Ukrainian honey is distinctive – with a yellow tinge. You can tell from the first look.” And considering the amount of testing in the primary export markets, namely the U.S. and EU, getting it into the final destination is extremely difficult even if it could be transshipped in the first place.
Harder to prove, yet just as important, is that the honey did not come from the south-east corner of Ukraine currently under the control of Russia’s henchmen and currently under embargo by the U.S. government. While Donetsk Oblast in particular was best known for its heavy industry, substantial quantities of honey were and still are produced in its agricultural land. As Olga Tromfimtseva noted, though, the industry in Ukraine is tightly knit, and this perhaps as much as regulatory requirements in the U.S. has kept honey in the occupied regions from filtering through.
If there is an existential threat, though, it comes from closer to home. The Chinese government has shown an interest in renting up to 10% of the arable land in Ukraine to feed its own people. If and when this will extend to honey production as well as the quality of the honey that would be produced are big question marks.