2. Project matter
Appeal
Progress
Cost
Establishing of industrial greenhouse (protected ground) to grow vegetables
(tomatoes, cucumbers) in Kryvyi Rih (Dnipropetrovs'k oblast) on an area of 1
hectare
city’s large population (as for 01.12.2012 - 659,5 thousands of people);
absence of industrial vegetable greenhouses in the city;
presence of target market (grocery markets, supermarkets, retail trade net);
average salary in the city – 3 657,0 UAH;
stable demand for vegetable products
The Project needs creating of project and budget documentation on building works
The Project’s estimated cost is 12,8 m. UAH
The Project implementation resources: investor’s own funds
Project’s effectiveness indexes
Index
Discounted payback period, DPP
Net present value, NPV
Internal rate of return, IRR
Unit of account
Number
month
52
thousand UAH
2 057,37
%
25,8
Profitability index, PI
Budget (owner’s equity)
1,2
thousand UAH
12 768,3
2
3. Commentaries:
Today there are 5 greenhouses of protected ground working in
Dnipropetrovs'k oblast with total area of 39,2 hectares.
Магдалинівський
There is no industrial greenhouses with protected ground in the
Kryvyi Rih city
Царичанський
Новомосковський
Юр'ївський
Петриківський
3
Павлоградський
Новомосковськ
Верхньодніпровський
Петропавловський
1
2
Dnipropetrovs’k
П'ятихатський
№
Дніпропетровський
Межівській
Business name
Area, hectares
Покровський
LLC ТК "Дніпровський"
6,0
2
Dnipropetrovs’k city
LLC АПФ "Агроінвест"
3,7
Village of Elyzavetivka,
Petrykivs’k area
LLC ТК "Дніпровський"
17,5
Village of Katerynivka,
Nikopol’ area
PE АФ "Катериніська-1"
6,0
5
Солонянський
Софіївський
Village of Yuvileyne,
Dnipropetrovs'k area
4
Васильківський
Синельниковський
1
3
Криничанський
Криворізький
Location
Village of Menzghyns’ke,
Nikopol’ area
PE "Пектораль"
6,0
Нікопольський
Kryvyi Rih
4
5
Широківський
Широківський
Апостолівський
Томаківський
Нікополь
Generally Ukraine covers only 55% of population needs in greenhouses (protected
ground, winter and spring).
Greenhouse area dynamics in Ukraine 2008-2012 years,
thousand hectares
3,168
2,897
3,271
2,873
2,619
3,3%
10,3%
10,6%
-0,8%
2008
2009
2010
The area of growing facilities in protected ground at Ukraine are increasing last 5
years, except 2010, and as to 2012 they are 3,27 K ha.
According to the Ministry of agricultural politics, the area of brand-new greenhouses
launched in 2012 is about 60 ha (30 objects) with overall investments more that 1.6
billions UAH.
The greenhouses of Ukraine are generally specialized on growing of vegetables 79%, flowers - 19%, fruits and mushrooms- 2%.
The glass greenhouses in Ukraine holds just 2,8%. The most popular greenhouses
complexes are spring (film) ones (55,6%) and tunnels-like (41,7%).
2011
2012
3
4. Normative and actual vegetables consumption,
kg/1 person.
Current situation
140
134
120
Proportion of the imported fresh vegetables at the Ukrainian market is about 30%, that is
explained by considerable demand on products at the internal market (from data of
Derzhkomstatu, from 2006th for 2010 the import of tomatoes was increased in 13,1 times,
cucumbers — in 15 times and made in 2010 year 48,2 and 14,1 K accordingly).
According to actual consumption of vegetables per a person Ukraine goes behind ratified
norms of consumption (an annual norm is 134 kg, cucumbers and tomatoes are 49 kg from
this amount; an actual consumption is 110 kg, cucumbers and tomatoes are 32 kg from this
amount ( less than a norm on 35%).
The vegetables sale price dynamics at the city’s
markets in 2012 year, UAH/kg
98,3
80
113,8
117,2
118,4
109,5
60
49
40
20
0
2006
2007
33
31
28,5
2008
2009
31,7
2010
33,9
2011
34,3
2012
Years normative of vegetables consumttion in Ukraine, kg/1 person.
29,32
30
24,22
23,79
20
15
107,2
Actual vegetables consumption in Ukraine, kg/1 person.
35
25
100
21,98
18,41
21,17
22,58
23,23
18,75
15,61
20,2
12,09
16,23
14,88
10
7,29
5
Years normative consumption of cucumbers and totamtoes in Ukrain
kg/1 person.
Actual consumption of cucumbers and totamtoes in Ukraine, kg/1
person.
8,1
The greenhouse cultures market
segmentation in Ukraine, 2012 year,%
0
5,8%
cucumbers
tomatoes
49,3%
44,8%
The highest price of cucumbers during the year exceeds the lowest in 4 times, tomatoes
– in 2.8 times.
The average price in 2012 of cucumbers – 19,00 UAH/kg, on tomatoes -18,25 UAH/kg.
The most profitable period to sell greenhouse products is from January till May.
tomatoes
cucumbers
other cultures
The domination of cucumbers and tomatoes among
the greenhouse cultures is explained by lower risks in
their growing than one of strawberries or salads.
4
5. COMMENTARIES:
Channel
Airfield
«Dovgyncevo»
Land location
Within city limits
Blagoeva street,
Dovgyncivs’kyi area
Land area
About 20 hectares
Recommended for the
greenhouse - 10 000 m2
Accessibility to the area
by asphalt road
400 m2
Greenhouse overall area
9 600 m2
Greenhouse usable area
including:
for growing tomatoes
for growing cucumbers
7200 m2
4500 m2
2700 m2
Average harvest from
1 m2:
tomatoes
cucumbers
Station
«Lisozahisna»
Access to water and
electricity sources nearby
The area of administrative and
production and storage
facilities
Station
«Novoblochna»
Communications
20-60 kg
25-50 kg
*Note:
The city council additionally offer unused lands in Inguletsk area for the development of greenhouse:
1) Fialkova street- 0,14 ha; 2) Zelenivs’ka street- 0,2 ha.
5
6. Conventional
signs
Novoblochna
startion
Lisozahisna
station
bridge
well
electrical network:
support pillars are available;
necessity of electric supply network to
the land in 1380 m.
water supply:
a well is available;
necessity of water supply tubes to the
land in 590 m.
railway:
two railway stations disposed near the
land:
Lisozahisna station– 1200 m
Novoblochna station- 800 m
roads:
asphalt motorways;
passenger traffic taxis (shuttle buses):
№206, 264, 265, 269;
the distance between the bus station
and the land is 2,4 km
Potential land area for the greenhouse
There are no facilities on the land territory
6
7. Greenhouse facilities placement scheme on 1 hectare
Greenhouse characteristics:
Material: polycarbonate, thickness 8 mm. Polycarbonate is highly resistant to
precipitation and ultraviolet rays, has a high level of light transmission, that
makes better influence on microclimate for much earlier maturation of all
greenhouse cultures, provides high heat saving level.
Frame: aluminum profile. Aluminum is a chemically inert metal, excluding its
rust and corrosion under the influence of any conditions (outside) and internal
modes of Greenhouse (high temperature and humidity). Greenhouses frame
does not bend due to square crossing of profiles (2х2 cm), profile thickness is
1,5 mm, and extra supporting design elements.
High: 2,5 m; width: 4 m; length: 15 greenhouses – 100m, 10 greenhouses –
90m.
Life settings: 10 years and more.
Cost: 4 265,36 K. UAH.
Possible supplier: Ltd. «Ukrains’ki teplytsi», Ukraine, Odessa city,
tel.: (048) 700 55 44
Equipment characteristic:
Equipment title
Description
Cost, K. UAH
270 UAH/sq.m. х 7200 m2
1 944,0
400 UAH/1 lamp х4800 lamps
1 920, 0
((2100 UAH х 4 pieces) + 3600 UAH) х 25
greenhouses
300,0
Humidity system
3100 UAH х 25 greenhouses
77,5
Drip Irrigation
5000 UAH х 25 greenhouses
125,0
900000 UAH/15 greenhouses + 600000
UAH/10 greenhouses
1 500, 0
Greenhouse radiant heating system
Greenhouse light system (LED lights)
Greenhouse ventilation system
Vegetables growing system
*Note: delivery and equipment assemblage costs are not included
7
8. Project implementation schedule
2013 year
Measures
April
May
June
July
Sept.
October
Nov.
Budget,
K, UAH.
Allotment of land
31,8
Official documents processing
7,25
Project-financial
documentation development
350
Communications supply
(water, electricity)
150
Greenhouse building
4 265,36
Building of administrative and
store facilities
600
Buying and installing of
equipment
7 163,1
Buying of transportation units
200,8
Greenhouse work
implementation
PROJECTS BUDGET,
overall, K. UAH.
10,6
10,6
189,22
253,62
1 696,79
1 621,79
8 985,68
12 768,31
8
9. TOMATOES
CUCUMBERS
40
10,9%
35
29,83
19,5%
25
26,17
21,9
20
15
33,12
13,9%
30
8,7%
16,8%
10
20,74
18,76
17,25
15,53
13,30
45
40
35
30
25
20
15
10
5
0
36,76
11,0%
10,6%
11,1%
5
0
2014
2015
2016
Own cost, UAH/kg
2017
2018
10,9%
11,0%
38,27
13,9%
19,5%
34,48
31,06
27,25
22,80
14,63
22,12
20,10
18,62
16,89
7,9%
10,2%
10,0%
15,4%
2014
Sale cost, UAH/kg
2015
2016
Own cost, UAH/kg
2017
2018
Sale cost, UAH/kg
Own cost structure and product’s sale cost
Indexes
Unit of
account
Tomatoes
Cucumbers
2014
2015
2016
2017
2018
2014
2015
2016
2017
2018
Raw and other materials
K. UAH.
3,9
4,05
4,3
4,46
4,69
2,31
2,43
2,55
2,68
2,81
Fuel and energy
K. UAH.
875,0
918,8
946,31
984,2
1018,6
525,0
551,25
567,79
590,5
611,17
Other material expenses
K. UAH.
30,3
31,9
32,8
33,7
35,1
181,76
19,1
19,66
20,25
21,06
Amortization
K. UAH.
508,3
1016,6
1524,9
2033,2
2603,95
304,97
609,95
914,92
1219,9
1562,37
Wages
K. UAH.
407,3
447,98
492,8
542,05
596,25
244,35
268,79
295,66
325,23
357,75
Payroll accounting
K. UAH.
150,7
165,75
182,33
200,56
220,61
90,41
99,45
109,4
120,34
132,37
Own cost
K.UAH.
1975,4
2584,9
3183,3
3798,14
4479,21
1185,22
1550,95
1909,98
2278,89
2687,53
Profitability
%
54,30
57,60
61,25
64,31
64,9
46,89
51,47
56,15
60,11
61,33
Sale cost
UAH/kg
21,90
26,17
29,83
33,12
36,76
22,80
27,25
31,06
34,48
38,27
t
148,5
166,5
184,5
202,5
216,0
81,0
91,8
102,6
113,4
121,5
Output
9
11. STRENGHTS
Convenient geo-economical location
Approach roads
Using intensive growing technologies
High quality production
Flexible pricing
Absence of similar greenhouse facilities in the city
WEAKNESSES
Lack of developed markets
The presence of competition from households
Proceeds of cheap vegetables from other regions and
countries
OPPORTUNITIES
Development of new markets at neighboring regions
Attracting new customers
The rapid growth of greenhouse products
Expansion of products assortment
Increasing yields of vegetables cultures
Creating an own network of sales outlets
Possible expansion of production area (to 20 ha)
Possible risks
THREATS
Тtechnical problems in the production organization
Probability of new competitors
Growth of inflation
Contract difficulties with suppliers and customers
Unstable economic situation
Tariff increases on energy and water
Reasons
Measures to reduce
Need for increase the investment
Increasing terms of projects
implementation
Overseeing the implementation and
compliance a work schedule
Reduced demand of products
Market oversaturation, whole economy
conditions
Expansion of markets, including export
Reducing the sale cost
Considerable level of competition,
seasonality
Achieving lowest spending level
Product quality discrepancy
Diseases of greenhouse plants
Using intensive technologies of
cultivation and protection
Implementation period increase
Delays in delivery and installing works
Contract predictions in delays penalties
11
12. To achieve a normative year-consumption of cucumber and tomatoes the estimated
market size of greenhouse products is 32,3 K tones.
Project’s production
volumes
2014
2015
2016
2017
2018
229,5
258,3
287,1
315,9
337,5
year/tons
Potential sales markets:
grocery and mixed city’s markets (28). Monthly average vegetables sale on the city’s
markets is more than 45 tons;
supermarkets and grocery stores in the city (54). Monthly average sale is about 45
tons;
restaurants (434);
preschool educational establishments (155);
secondary educational establishments (147);
health care establishments (54)
MARKETING STRATEGY:
sale of fresh products during the ―peak price‖ period on markets (winter-spring);
marketing measures for products promotion, expansion of city’s markets (including
possibilities for export)
12
13. THE CITY GOVERNMENT
Land allocation
Assistance in communications supply
Assistance in passing of permission
procedures
DEVELOPMENT
INSTITUTION
Providing the investor with information to
make optimal decision
Assistance
of
passing
licensing
procedures and implementing of the
project
PRIVATE SECTOR
Experts knowledge
Carrying out business analysis and risk
assessments
Investments in the greenhouse building
Competence of managing business in the
industry
Creating new jobs (17 persons)
Income from the successfully working
business
Providing city residents with domestic
vegetables products
Reducing import products
Additional revenues to the budgets of all
level trough the taxes and fees
BENEFITS
The possibility to expansion greenhouse
area, which can increase the income,
sales volume and sale markets.
13
14. Director of PU Kryvyi Rih City
Development Institution
Leader of Strategy Program of PU Kryvyi Rih
City Development Institution
Analyst of Strategy Program of PU Kryvyi Rih
City Development Institution
Kryvyi Rih, Metalurgiv Avenue, 28
Tel: +38 056 492 98 48
Теl: +38 097 738 44 50
E-mail: irm_kr@i.ua
Kryvyi Rih, Metalurgiv Avenue, 28
Теl: +38 056 492 98 28
Теl: +38 096 968 96 16
E-mail: irm_kr@i.ua
Kryvyi Rih, Metalurgiv Avenue, 28
Теl: +38 056 492 98 28
Теl: +38 097 566 10 60
E-mail: irm_kr@i.ua
14
