Creating closed value chains in dairy farming as a tool for the industry's "green" competitiveness

Abstract

Abstract. The need to increase economic efficiency, environmental sustainability, and reduce the negative impact of dairy farming on the environment in the context of global climate change requires the search for new mechanisms for increasing the "green" competitiveness of the industry. The aim of the article is to find ways to increase the long-term competitiveness of the dairy farming industry, considering the principles of "green" priorities of agribusiness. The article examines the main current problems of the functioning of the dairy farming industry in Ukraine: low productivity of farm animals and low rates of technological modernization of production, small-scale nature of milk production, low development of concentration and cooperation of production, lack of inclusive access to financial capital markets, and ineffectiveness of state support for the industry. The set of factors influencing the creation of long-term sustainable advantages for Ukraine's dairy farming industry is substantiated. The systematization of these factors enabled them to be grouped into the following main categories: economic and resource factors, technological, institutional, and regulatory factors, and human capital. One way to gain long-term competitive advantages amid the industry's new “green” challenges is to organize closed (circular) value chains. The author’s model for creating long-term competitive advantages in dairy farming, based on closed value chains and the integration of selected factors, is presented. The key prerequisites for organizing industry integration in dairy farming through circular (closed) value chain mechanisms are outlined. Among them: modernization of the technological base of dairy farming, building human capital, inclusive access to financial resource markets, and development of partnerships between dairy producers and state institutional and financial support. It is emphasized that the foundation for implementing “green” transformations in the dairy farming industry should be increasing the social responsibility of agricultural businesses.