What's behind EU gripes over Ukrainian grain?
Five EU countries have said massive imports of cheaper Ukrainian grain are putting local farmers under pressure. They're pushing Brussels to help.
After Russia launched its full-scale invasion of Ukraine in February 2022, the Black Sea route used by Ukraine to export foodstuffs was blocked off. With 20 billion tons of grain trapped in Ukraine and global food prices soaring, the European Union moved last May to set up "solidarity lanes" to get exports flowing out via member states. The EU also suspended tariffs on Ukrainian products.
Soon after — and thanks to a Ukrainian-Russian deal allowing shipments — these transport routes got going. But farmers in Poland then began protesting that they were being flooded by Ukrainian grain imports and felt they were being undercut, even if the grain was supposed to be destined for sale outside the EU.
In recent days and after months of discontent, Ukraine's western neighbors Bulgaria, Hungary, Poland, Romania and Slovakia have all announced import restrictions on Ukrainian grain. The European Commission has criticized the moves, but is now working on a fresh round of funding to relieve farmers and come up with a common approach. In the past few days, Warsaw and Bucharest have indicated they would lift some of the restrictive measures.
Why are import bans from EU countries a big deal?
If bans on import that also halt transit stay put, they could potentially help drive up global food prices once again. Ukraine accounts for 10% of the world wheat market, 15% of the corn market and 13% of the barley market, according to the European Commission.
Food prices shot up to record highs last year, causing huge concern about international food security. But they have since recovered to pre-war levels, figures from the UN Food and Agriculture Organization index now show.
In the meantime, the future of the Black Sea Grain Initiative — up and running since August — currently looks unclear. Russia has been indicating it might stop abiding by the export facilitation deal, brokered by the UN and Turkey and designed to keep food supplies flowing out of the region and feeding the world. On Sunday, agriculture ministers from the seven wealthy industrial G7 countries called for its extension.
What are EU officials doing about it?
The European Commission was quick to warn that trade policy decisions are taken collectively within the EU free trade bloc. Unilateral country decisions about trade are not possible, spokesperson Miriam Garcia Ferrer said recently. Theoretically, the member states striking out on their own could be sanctioned if they were found to have broken EU rules, but the EU executive branch seems more interested in finding a solution.
The European Commission is looking at pulling together another package of aid worth around €100 million ($110 million), a senior EU official said on condition of anonymity at a briefing. This comes after a €56 million package earlier this year, plus national relief plans financed in part by the relaxation of EU state aid rules.
The current focus is finding a common EU measure that ensures Ukrainian grain makes its way out of the country and then onward to the non-EU markets it is intended for, according to the senior EU source. One option could be a temporary ban on imports into Ukraine's EU neighbors on grain that isn't destined for sale outside the EU. This would still allow imports for transit.
What has Ukraine said about grain restrictions?
Ukrainian Agriculture Minister Mykola Solskyi has been in a flurry of meetings with neighboring EU states over the past week, releasing statements that tend to focus on the progress in talks with each country.
When Warsaw announced its restrictions earlier this month, Solskyi acknowledged in a press release that "that Polish farmers are in a difficult situation."
"But we emphasize that Ukrainian farmers are in the most difficult situation right now," he continued. "Ukrainian farmers are suffering enormous losses from Russia's war against Ukraine, and… Ukrainian farmers are dying on their fields because of Russian mines," he said.
Is EU support for Ukraine at risk?
It is worth noting that criticism from the governments of Poland and Hungary, for example, has focused on the alleged inadequacy of EU support for farmers so far, rather than Ukraine itself — Brussels rather than Kyiv, in other words.
Warsaw, in particular, is considered one of Ukraine's closest backers. Its ruling conservative, nationalist Law and Justice party is under election year pressure, and is counting on farmers to shore up its voter base. "We woke up the European Union!" Poland's Ministry of Agriculture and Rural Development posted on Facebook last week.
The dispute does perhaps foreshadow the challenges Ukraine and EU member states will face if Kyiv is to join the community of 27 member states with its open-border trade system. The bloc granted Ukraine EU candidate status in 2022, but the process of joining the EU takes years — even for countries not ravaged by war.
Edited by: Andreas Illmer
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