The Illegal Trade in Chemicals

Ukraine

The domestic production of pesticides constitutes 10–12 per cent of the Ukraine market – about 13,000 tonnes (Business Censor 2018). The major pesticides manufacturers all dependon importedactive ingredients, but have managed to increase their production. The slight reduction of Ukraine’s pesticides exports from 2013 to 2017 (Comtrade 2018) can be explained by an increase in demand in the domestic market and by the improvement in the procedures for customs clearance of re-exports. The available statistical information suggests that Ukraine’s large market and favorable location makes it home to one of the most interesting illegal markets of pesticides in Eastern Europe, the Caucasus and Central Asia. Industry reports and studies of international organizations confirm these trends. While some experts consider the share of illegal pesticides to be 25 per cent of the Ukraine pesticides market, the European Business Association values the illegal share at about US $150 million, or almost 19 per cent (Agro Portal 2016). China remains the biggest pesticide exporter to Ukraine, but international companies are increasing their market share, and 62 per cent of the pesticides are generics. The Chinese-owned Israeli manufacturer, Adama, has become the largest single supplier of chemical plant protection products in Ukraine, followed by Bayer and Syngenta (Infoindustria 2018). Historically, the largest share in imports came from herbicides at 62 per cent; the share of fungicides amounted to 24 per cent (Business 2018). The insecticides market also shows significant growth, part of which is believed to be due to climate change. The repackaging of pesticides in violation of storage conditions, including theuseof small containers targeting private landowners and small farms, causes a significant problem. In Ukraine, illegally repackaged products may account for about one quarter of annual pesticide sales, and according to law enforcement agencies in Ukraine, confiscated banned pesticides and repackaged outdated and obsolete pesticides are in some cases returned to the market (OSCE 2015). In 2018, MAMA-86, a Ukrainian national environmental non-governmental organization, conducted field research and surveys in four regions of Ukraine. Interviews with pesticide vendors from non-specialized chemical plant protection product (CPPP) stores, revealed that the vendors often do not have information about the product

suppliers to provide to consumers. Some stores repackage pesticides from larger containers into bottles, plastic bags or plastic canisters to meet the demand of small farmers and private landowners. The names of the CPPPs in such containers are usually written with a marker. The packages of fake CPPPs do not have the distinctive holograms that appear on the preparations from well- known foreign manufacturers, and distinguishing between original and falsified packages is sometimes nearly impossible. Given that some stores – even those specializing in CPPPs only – sell both original and counterfeit products, this is a serious problem. The counterfeit products are usually 50 per cent cheaper than the originals, and sometimes price is the only indicator that may help consumers distinguish between fake and original products. The retailers note that the decision to sell counterfeit pesticides is based on consumer demand for a cheaper but effective product. In addition, retailers need to compete with street vendors who often sell their counterfeits close by for a much lower price. Often enough the sellers behave aggressively and do not participate in the interviews or do not allow photos – behaviors that suggest that they recognize the illegality of their business. The interviews with local residents who use pesticides on their land demonstrate that only some of them buy pesticides from official distributors and in specialized stores. Private householders more often purchase pesticides on the market at more affordable prices. They believe what sellers tell them about the quality of the products and usually do not require additional documents or certificates that might reduce the risk of using counterfeit products. None of the interviewed buyers have ever visited the official websites of authorized manufacturers to study the appearance of the original packaging of the product to better understand if the CPPPs they purchase are counterfeit or original. Label information is not of interest to buyers either, but they do want to be sure that the effect of the product application will last long enough to protect their crops. Some regions in Ukraine experienced cases of pesticide poisoning that occurred as a result of the use of pesticide concentrates that were stolen from farms. These stolen pesticides were intended for field use, but local residents incorrectly applied them on their plots of land, and the results were acute pesticide poisoning.

The Illegal Trade in Chemicals

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