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. Last Updated: 07/27/2016

Panic Buyers Empty Kiev Stores

APA man checking the price rises on flour and buckwheat at a store in Kiev on Thursday
KIEV -- In an outbreak of panic-buying redolent of Soviet-era shortages, Ukrainians are stripping store shelves of flour, buckwheat and other staples amid skyrocketing prices driven by a disastrous harvest and alleged scams.

There's no immediate relief in sight for the country that has some of the richest soil in Europe and was the breadbasket of the Soviet Union.

"How can I say how much [flour] will cost next week, if I don't have any now?" said the manager of Kiev's Mekos grocery chain, who gave only his first name and patronymic, Ihor Nikolaivich.

When he called his wholesaler to restock his shelves, he said, he was told the warehouse had been emptied by the run on goods. Store managers face similar problems all over this capital of more than 3 million people.

"Yesterday, 3 tons of buckwheat just flew away. We didn't even manage to get it on the shelves, everything was taken off the handcarts," said one store manager. Other managers have moved other goods onto the staple shelves to lessen the grim appearance of short supply.

Flour that had been selling for about 3.50 hryvna (65 cents) 2 kilograms at the beginning of the week was up to 6 hryvna on Wednesday -- where it was available at all. Buckwheat underwent a similar rise.

The drastic price hikes take are a severe blow to Ukrainians, whose average monthly income is $71.

Deputy Prime Minister Mykola Azarov told the Cabinet on Wednesday that there was no cause for panic and called on citizens to stop frantic purchases, his spokesman Vitaliy Lukianenko said. Azarov claimed the hoarding had further fueled hikes already up due to bitter weather.

Ukraine's grain harvest is expected to plunge by as much as 40 percent to 23 million to 27 million metric tons after an extraordinarily harsh winter and dry summer wiped out much of the country's crops. But officials say that harvest figures were widely falsified so that state reserves appeared on paper to have sufficient supplies, allowing secret export sales that depleted an already short supply.

Azarov vowed to intervene shortly to stabilize the market by procuring supplies to satisfy consumer demand. Kiev city officials also announced plans to buy at least 4,000 metric tons of flour, sugar and buckwheat to stave off further increases, Interfax reported.

Meanwhile, Azarov ordered officials to prepare legislation allowing the government to confiscate "excess profits" and tasked tax officials with ensuring that all taxes are collected from traders, who he claimed had capitalized on the scare by raising prices.

President Leonid Kuchma has ordered officials to probe dozens of cases of alleged graft in the grain market.

Leonid Kozachenko, who headed Ukraine's agricultural policy until a Cabinet reshuffle in November, was jailed in March on charges of corruption, bribery and tax evasion, but was freed on bail this month following pressure from lawmakers and activists. They claim the charges were trumped up to disguise the government's failure to implement key reforms or its willingness to allow shady deals to go forward.

Although Ukraine is one of the world's largest grain exporters, it plans to import grain this year to compensate for the shortages.

Despite its agricultural riches, Ukraine was often hit by shortages during the Soviet era because of inefficient collective farming. It also suffered a devastating famine in 1932-33 that historians say was provoked by Josef Stalin as part of an undeclared war against peasants.