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. Last Updated: 07/27/2016

Deere Gets Mixed Reviews in Ukraine

KAHARLIK, Ukraine -- Two weathered farmers stood lamenting the worst harvest in years, watching a huge, green American monster roar past, chomping away at the ripe wheat fields of the Fatherland Farm.

The Deere & Co. combine is one of more than 1,000 such machines helping bring in this season's harvest in Ukraine, the one-time breadbasket of the former Soviet Union.

Despite its fertile black earth, Ukraine is facing a dismal crop, and some people are looking to the shiny new Deere harvesters as salvation from the woes of the ailing agriculture sector.

Five years after the Soviet collapse, Ukraine's farms are still coping with the legacy of decades of mismanagement. Collective farms -- over-staffed and equipped with aging, second-rate machinery -- still dominate, and their influential old-guard managers have stymied virtually every attempt at reform, including privatization.

Not everyone is enthusiastic about the country's deal with Deere, the Moline, Illinois-based farm machinery giant. Some critics say it feeds government bureaucrats and state farm owners while penalizing private farmers.

Out on Ukraine's rolling fields, farmers are alternately awed, perplexed and resentful of the Deere phenomenon.

"Everyone is jealous that we have these combines," said Volodymyr Slavchenko, who drives one for the Fatherland collective farm near Kaharlik, about 104 kilometers south of Kiev. Then, the ruddy 45-year-old snapped off a golden stalk of wheat, stuck it between his yellowed teeth, and started listing his complaints:

?The diesel fuel the combines require is expensive and in desperately short supply.

?The Deere harvesters are having a rough time on Ukraine's uneven soil, which already has disabled one of the Fatherland Farm's two machines.

?Replacement parts take months to arrive.

Still, the Deere combines bring in nearly 220 tons of grain a shift, nearly twice the capacity of Soviet-made Don harvesters used on the rest of the farm.

Viktor Tymchenko, president of Ukragroprombirzha, the government agency established to deal with Deere, dismissed criticisms as fear of progress.

"I sat at the wheel myself, and after that I became obsessed," he said. "My only thought was how to bring this combine harvester to Ukraine."

And he did. Ukraine and Deere signed a $187 million deal in April for 1,049 of the 7-meter-wide harvesters.

The U.S. Export-Import Bank is providing loan guarantees to support the deal -- largely under pressure from the Clinton administration, which is pouring money into the former Soviet state to encourage its transition to a market economy. Ukraine is the third largest recipient of U.S. aid this year.

But Tymchenko's Ukragroprombirzha is doling out the harvesters to largely state-run farms.

Harry Walters, an agriculture adviser for the U.S. Agency for International Development, said state controls and stalled land reform leave foreign investors and aid organizations little choice but to focus on huge state farms.

So far Ukragroprombirzha is leasing most of the machines or trading them for grain. But Tymchenko has said he would sell them at $252,000 each -- well over the $190,000 that farm specialists in Kiev say they should cost.

"You have to be prepared to work with large farms if you're going to help at all," he said.

But he added, "You do what you can to stimulate people to privatize, too."

That is no easy task. A mere 2 percent of Ukraine's farmland belongs to private farms. A far larger portion of land -- 12 percent -- is in the form of tiny, private backyard garden plots.

In fact, most private farms are too small to reap the benefits of the Deeres, a point that critics argue shows no one in the government was looking out for the little guy when the contract was signed.

Equipment shortages are not the only things plaguing Ukrainian farming this year. Grain harvest predictions are as low as 27.5 million tons -- even lower than last year's disappointing yield.

Hrihory Pavlyuk, deputy director of the Victory Collective Farm in the central Ukrainian town of Butky, said: "It's good that the American combines can gather more wheat. But what if there's no wheat to gather?"