Agriculture
Tobacco is grown in some southern and western regions of Ukraine. Tobacco production in Ukraine was very high in the 1980s (28,190 tones in 1987). It declined in early 1990s (9,000 tones in 1992), and especially in late 1990s - average annual production in 1996-1999 was less then 3,000 tones (Table. 1). In 1999 Ukraine produced 3,260 tones of raw tobacco (1,580 tones was exported mainly to Russia, Moldova, Belarus and Lithuania). In 1999 Ukraine imported 49,14 tones of raw tobacco. 97% of cigarettes produced in Ukraine consist of imported tobacco. The main importer of raw tobacco to Ukraine is Germany (21% of all import). German tobacco is the most expensive when compared with other countries (3.23 USD per 1 kg, while average is 2.26). Reemtsma controlled in 1999 about 50% of the Ukrainian tobacco market and import of tobacco to Ukraine supports German tobacco exporters. The only Commonwealth of Independent States (CIS) country, which has large raw tobacco export to Ukraine is Kyrgyzstan (11% of Ukrainian import). Among other raw importers we can mention USA and the EU countries of Greece, Italy and Spain. As tar and nicotine limits are higher in Ukraine, the tobacco industry can use the EU subsidies to supply high tar tobacco to such countries as Ukraine.
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