20:54 31.05.2023

EU may extend restrictions on agricultural exports from Ukraine - European commissioner

4 min read
EU may extend restrictions on agricultural exports from Ukraine - European commissioner

Contrary to Ukraine's expectations, European Commissioner for Agriculture Janusz Wojciechowski proposed extending the ban on the export of Ukrainian wheat, maize, rapeseed and sunflower seed to Poland, Hungary, Romania, Slovakia and Bulgaria at least until the end of October.

"Today, during the [Agriculture and Fisheries] Council meeting, Ukrainian Minister Mykola Solsky called on the member states not to prolong these measures [...] I presented the position that we need to prolong [them], best to the end of the year but minimum to the end of October," Ukrainian media quoted Wojciechowski as saying at a press conference in Brussels.

The official said that the European Commission is yet to decide whether to extend the special measures for these five countries, adding that this stance is currently his personal vision on how to resolve this problem.

During the discussion, some EU member countries wanted to know why the measures apply only to these five member countries, though there are consequences for the common market, he said.

Agricultural exports from Ukraine rose by EUR6 billion to EUR13.2 billion in 2022, partly thanks to its liberalization in June of last year, but more than 80% of this growth was due to the increase in imports to these five countries - from around EUR1.3 billion to EUR6.2 billion, Wojciechowski said.

"It was European Union support for Ukraine. But the cost of the support was paid mainly by the farmers in these five member states," the European commissioner said.

The increase in imports by nearly EUR5 billion was a "shock" for the markets of these five countries and prompted the European Commission to introduce special measures such as a ban until June 5 on the import of Ukrainian agricultural products directly to these five member states and to provide them with EUR 100 million from the European agricultural reserve to resolve problems on their internal markets, he said.

There are still quite large amounts of grain in storage in these five countries, Wojciechowski said, expressing confidence that the extension of the special measures will help improve this situation.

"Without the prolongation of this instrument, we [the EU] will have huge problems with the harvest," he said.

In parallel, the European Commission is discussing the functioning of the Solidarity Lanes (established to facilitate Ukrainian agricultural exports amid the limited operations of its Black Sea ports), he said.

"The main direction is from Ukraine by Romania. Just about 7 million tonnes of Ukrainian grain was exported in transit by Romania, by Poland just about 700,000 tonnes, Hungary 300,000 tonnes, Slovakia about 200,000 tonnes, Bulgaria less than 100,000 tonnes," Wojciechowski said.

He underscored the problem of support for the Solidarity Lanes in Romania, which has already been discussed at the European Commission's talks with the Romanian side. In particular, they discussed the potential of the Danube River and the possibility of deepening its shipping canal in order to enable it to be used by larger vessels. That was one of the proposals that the European Commission has received from Ukraine, which has called for improving transit capacities, including via Romania.

Wojciechowski also welcomed the extension of the Black Sea Grain Initiative, adding that "for two months it will be easier to export grain from Ukraine." However, it is also necessary to take account of the situation when Ukrainian grain exports may be blocked and the overall volume of Ukrainian exports while planning the operations of the Solidarity Lanes, he said.

When commenting on the prospects of the upcoming season, Wojciechowski said that Ukrainian exports will decline in 2023 because the area under cultivation has been decreased and there may be a 40% decline in this year's harvest as compared to previous years.

"It is possible, with improvement, to organize the Solidarity Lanes and to cover all exports by Solidarity Lanes," he said.

Polish Agriculture Minister Robert Telus, for his part, said after the talks that a number of EU member countries are opposed to extending the restrictions beyond June 5.

"Yesterday in Brussels, I spoke about extending the measures that came into force on May 2. There are countries that don't want it to be applied after June 5. I hope that they are just solitary voices," Telus was quoted as saying in a statement circulated by the Polish Agriculture Ministry on social media.