IDEAS home Printed from https://ideas.repec.org/a/eip/journl/y2016i3p66-76.html
   My bibliography  Save this article

Profit and profitability of the agricultural enterprises in the process of inflation

Author

Listed:
  • B. Paskhaver

Abstract

The crisis of 2014-2015 had a devastating effect on the financial condition of Ukrainian enterprises: in the whole national economy, the positive profitability of the companies was reversed. An exception to this trend is the agricultural enterprises, where in 2015 a significant growth in profits and profitability took place. The factors that contributed to that phenomenon were: 1) a slight increase in sales; 2) inter-sectoral price disciplinary in favor of the agro-sphere; 3) the characteristic for agriculture lag between production costs and selling products, which, with high inflation, gives a temporary increase in profits. The author considers the question of determining the appropriate level of profitability necessary for sustainable development of the agro-sphere. It is recommended to calculate this index as the ratio of profit to the restored value of production (fixed and circulated floating). Although the profitability of agrarian enterprises grew during the crisis, decline in domestic effective demand negatively affected the output in all sectors of the agro-industrial complex. Output in the whole of agriculture decreased by 3%, in food processing - by 8.5%, and in food trade, the turnover in retailing decreased by 20%, and in wholesaling – by 30%. The author shows the role of government support of the agro-sphere in the dynamics of the financial condition of agricultural enterprises, and draws attention to the need to focus public support to solve the problems of unprofitable businesses and food sub-complexes in the agro-industrial complex.

Suggested Citation

  • B. Paskhaver, 2016. "Profit and profitability of the agricultural enterprises in the process of inflation," Economy and Forecasting, Valeriy Heyets, issue 3, pages 66-76.
  • Handle: RePEc:eip:journl:y:2016:i:3:p:66-76
    as

    Download full text from publisher

    File URL: http://eip.org.ua/docs/EP_16_3_66_uk.pdf
    Download Restriction: no

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eip:journl:y:2016:i:3:p:66-76. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Iryna Bazhal). General contact details of provider: http://eip.org.ua/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.