Ukrainian Defence Ministry changes prices of food for army: egg price falls

The Ministry of Defence of Ukraine has published updated contracts for the procurement of food products for the army; the food supply service will range from UAH 137 to UAH 144 [approximately USD 3.71-3.9], the terms of the contracts have been shortened, and food prices have decreased. In particular, eggs will cost UAH 8-9 [equiv. to approx USD 0.22-0.24] per unit.  Source: press service of the Ministry of Defense

Quote: "In order to ensure the transparency of purchases and access to information and publication of reports on the procurement of catering services of the Armed Forces of Ukraine... On 20 February 2023, changes were made to 8 contracts, according to which the validity period of the agreements was reduced and, accordingly, changes were made to the cost of catering services and prices in the product catalogue. The cost of the catering service ranged from UAH 137.04 to UAH 144.06.

The decline in prices was due to shorter contract terms, which prevented suppliers from considering inflation and other risks.

The prices of the products purchased by the supplier take into account the logistics." Details: The Ministry of Defence reports that it purchases not only the products themselves, but also services for "receiving, storing, moving, refreshing food stocks, issuing food, their accounting, preparing meals in stationary and field conditions, providing technical means of cooking with fuel, maintaining canteens and warehouses, equipment and property in proper condition and their technical maintenance, reimbursement of utility costs", etc. In particular, the price of eggs will be UAH 8-9 depending on the quality grade, and pastawill cost from UAH 35.70 to UAH 42.30 [equiv. to approx USD 0.97-1.15] per kilogram.

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The price of a kilogram of fresh potatoes is from UAH 12.60 to UAH 17.70 [equiv. to approx USD 0.34-0.48], a kilogram of fresh early potatoes is from UAH 16.90 to UAH 40 [equiv. to approx USD 0.46-1.08], and a chicken thigh's price varies from UAH 90.96 to UAH 108 [equiv. to approx USD 2.46-2.92] per kilogram. After the investigation, the information about "chicken eggs for 17 hryvnias" went viral: the journalists' investigation mentioned the price for a unit, even though the document contained the price for 100 grams.  Defence Minister Oleksii Reznikov has explained that the prices of 17 hryvnias for an egg are "a usual technical mistake made by a supplier" who supposedly noted the price not per unit but per kilogramme. 

An interdepartmental working group chaired by First Deputy Prime Minister Yuliia Svyrydenko was also created to study new approaches to purchasing products for the Ministry of Defence, using the e-procurement system.

The group is reportedly working on updating the system to balance secrecy and public oversight of military procurement. This information about the numbers of military units, their location and the number of personnel will be publishe, but no details will be provided. Background:

• ZN.ua reported on 21 January that the Defence Ministry procured food for soldiers two or three times more expensive than in shops in Kyiv.

  Bohdan Khmelnytskyi, already involved in the case of embezzlement of US£580,000 during the procurement of military ammunition, signed a contract with the Aktyv company in December. 

• Information about "chicken eggs for 17 hryvnias" became viral: the journalists' investigation mentioned the price for a piece, even though the document contained the price for 100 grams. 
• The Ministry of Defence called the information about food being too expensive a deception and manipulation and promised to turn to the Security Service of Ukraine. Defence Minister Oleksii Reznikov denied the accusations of his ministry. Later in his interview with Ukrainska Pravda, Reznikov admitted that he was too emotional and promised to thoroughly check all facts discovered by the journalists. 
• Viacheslav Shapovalov, Deputy Minister of Defence, resigned on 24 January 2023 due to the scandal over food procurement for the Ukrainian military at inflated prices.

  Bohdan Khmelnytskyi was fired from the position of the head of the state procurement department at the Ministry of Defence of Ukraine.

  It became known on 25 January. 

• Prime Minister Denys Shmyhal instructed to update the state procurement system for the Armed Forces of Ukraine that would include publishing prices for food and products. 

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