The Lavender Business in Ukraine: How Much Does It Cost to Start and When Can You Start Making Money?
20 May 14:37
The lavender business in Ukraine looks romantic only in photos. In reality, behind the purple fields lie significant investments, weather risks, processing costs, and the need to create high-value-added products. Lavender is gradually transforming from a niche crop into a separate segment of small-scale agribusiness. This is reported by "Komersant Ukrainian" with reference to Vector.
Ukrainian farmers earn money from lavender not only by selling raw materials. The main profit margin comes when the farm moves into processing: producing essential oil, hydrosol, cosmetics, candles, sachets, soap, aromatic products, or developing agritourism.
How much does it cost to start a lavender business
According to farmers’ estimates, starting a lavender plantation in Ukraine can cost as much as $10,000 per hectare. The largest portion of the budget goes toward seedlings, soil preparation, an irrigation system, and plant care.
If a farmer wants to not only grow lavender but also process it, additional investment in equipment is required. A distillation line or mini-processing facility can cost another $30,000–50,000.
The main costs of growing lavender are broken down as follows:
| Cost category | Share |
|---|---|
| Irrigation system | 40% |
| Fertilizers | 31% |
| Wages | 14% |
| Fuel | 6% |
| Equipment services | 4% |
| Other expenses | 5% |
When lavender starts turning a profit
You won’t be able to recoup your investment in the lavender business quickly. In the first one to two years after planting, the plant mainly develops its root system and gains strength. The yield during this period is minimal or nonexistent.
A plantation usually begins to produce a stable commercial harvest in the second or third year. Profitability in the third year can be around 36%, and in the fifth year, it can reach 200%.
After that, lavender can remain productive for up to 25 years, but over time, yields decline: the plants age, the soil becomes depleted, and the risk of disease increases.
Therefore, growers have to replant or relocate their plantations to new sites.
An example of a craft farm
Anna Zbinska, co-founder of the LavandAnna brand, said that launching the craft business on 20 acres cost about 400,000 UAH.
According to her, the initial planting of lavender did not require significant investment, as the land and seedlings were already owned. However, expenses later increased due to field maintenance, the purchase of tools, distillers, containers, product ingredients, and the setup of a technical facility.
“My husband and I started the business in 2016. There were no investments, as such, for the first lavender planting: the land and seedlings were ours. Finding good-quality ones back then wasn’t easy, so we grew them ourselves from seeds,” said Anna Zbinska.
The farm now has over 1,000 lavender bushes and is planting another field of roughly the same size.
Processing—the main source of profit
The biggest profits in the lavender business come not from the cultivation stage, but from the processing stage.
Lavender is used to produce:
- essential oil;
- hydrosol;
- creams;
- shampoos;
- masks;
- balms;
- soap;
- candles;
- scented sachets;
- cosmetics and aromatic products.
With effective irrigation, one hectare of lavender can yield 120–147 liters of essential oil. On average, Ukrainian farmers harvest 5–7 tons of green matter per hectare, and the essential oil yield is approximately 1.7–3% of the plant’s weight.
According to market estimates, selling essential oil from one hectare can generate about 158,000–160,000 UAH in revenue per season. Selling green matter or dried lavender yields significantly less.
How much do lavender products cost
On the Ukrainian market, dried lavender can be sold wholesale for approximately 700–1,400 UAH per kilogram. The price depends on color, aroma, drying quality, and packaging.
Lavender oil on the wholesale market can cost between 300 and 2,700 UAH per liter—depending on the variety, distillation quality, and type of lavender.
In retail cosmetics, the price is quite different. A small 10–30 ml bottle of essential oil can cost up to 900 UAH.
For example, at LavandAnna, lavender essential oil costs 480 UAH for 10 ml, and a soy candle with lavender oil costs 650 UAH.
Agritourism as a source of additional income
Agritourism is a separate source of income. During the blooming season, lavender fields become photo locations, venues for festivals, workshops, seasonal events, and celebrations.
Admission to a lavender field for a photo shoot in Ukraine costs approximately 200–400 UAH.
However, farmers note that photo sessions are more of a seasonal bonus than a primary source of income.
According to Anna Zbinska, photo shoots account for about 10% of her business’s profits, while the main income comes from products.
The Most Profitable Segments of the Lavender Business
The Ukrainian lavender market can be broadly divided into several segments:
| Segment | Characteristics |
|---|---|
| Dried lavender | The easiest way to get started, but limited added value |
| Essential oil | Higher margin, distillation required |
| Hydrosol | Byproduct of processing, additional income |
| Cosmetics and fragrance products | Highest added value |
| Seedlings | You can earn money even before the field reaches full yield |
| Agritourism | Helps sell products directly and promote the brand |
Profit in this business is determined not only by how much lavender has grown in the field, but by which stage of the value chain the farmer has reached.
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What are the risks of the lavender business
The main risk is the weather. A cold winter, an unstable spring, or a rainy summer can significantly affect the quality and quantity of essential oil.
Anna Zbinska said that the spring of 2024 was very difficult for her farm.
“Spring 2024 was the hardest for us; all the lavender froze then, and we harvested only 30% of the bush’s potential,” she noted.
Other risks include:
- high startup costs;
- a long payback period;
- dependence on the quality of seedlings;
- the need for irrigation;
- lack of market data;
- processing costs;
- difficulty in marketing without a brand.
The lavender market in Ukraine has almost no statistics
Despite growing interest, the lavender market in Ukraine remains virtually invisible to government statistics. It does not have a separate category within the agricultural sector.
The closest KVED code for such farms is “Cultivation of aromatic, medicinal, and spice crops.” There are 170 companies registered under this code, but it includes not only lavender but also mint, sage, basil, and other crops.
According to some estimates, there are about 244 lavender fields in Ukraine. It is difficult to determine their exact area. The largest field is in the village of Vasylivka in the Odesa region, covering 55 hectares.
Other large fields include one in the Chernivtsi region covering 16 hectares and one in the Zakarpattia region covering 10 hectares.
The total area of lavender fields in Ukraine is estimated to range from 300 to 800 hectares. By comparison, sunflower fields in Ukraine cover millions of hectares.
Will lavender become a promising new crop?
The lavender business in Ukraine resembles craft winemaking or the coffee niche: the raw material itself generates limited revenue, while the real profit comes from processing, branding, product storytelling, and direct contact with the buyer.
A lavender field alone does not guarantee profitability. The business begins when the farmer becomes a producer, marketer, salesperson, event organizer, and creator of a local brand.
Whether lavender will become a crop on the scale of wheat or sunflowers remains an open question. But it already has a chance to become an important part of the niche agricultural sector with high added value.
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