A flood of grain from Ukraine

A flood of grain from Ukraine
Cheap Ukrainian grain has put pressure on farmers in Central Europe, leading to a brief ban on imports as governments are torn between supporting Ukraine and protecting their farmers. / bne IntelliNews
By bne IntelliNews April 19, 2023

Slovakia has joined Poland and Hungary in halting imports of grain and other agricultural products from Ukraine in an attempt to protect local farmers from a glut of grain coming from their embattled neighbour, Statista reports.

The drastic move, announced by Poland and Hungary on the weekend and by Slovakia on April 18, drew immediate criticism from Brussels, while the reaction from Kyiv struck a more conciliatory tone.

“It is important to underline that trade policy is of EU exclusive competence and, therefore, unilateral actions are not acceptable,” a spokesperson for the European Commission said in an emailed statement.

“In such challenging times, it is crucial to co-ordinate and align all decisions within the EU,” the statement added. Meanwhile, the Ukrainian Ministry of Agrarian Policy and Food expressed its regret over Poland’s decision to restrict agricultural exports from Ukraine, while emphasising its willingness to find a mutually beneficial solution.

“We understand that Polish farmers are in a difficult situation, but we emphasise that Ukrainian farmers are in the most difficult situation right now,” the ministry said in a statement, before concluding that “the crisis should prompt our countries to co-operate even more closely in all sectors to address the root cause of these problems – Russian aggression.”

One of the world’s leading exporters of wheat, corn and vegetable oils, Ukraine shipped much of its grain to international markets prior to the war, particularly in North Africa and Asia. After Russia’s invasion of Ukraine, some of the country’s Black Sea ports were temporarily blocked, however, causing large amounts of (cheap) Ukrainian grain to remain in neighbouring countries such as Poland, Hungary and Romania. The resulting oversupply led to falling prices, causing significant economic hardship for local farmers.

Among the EU’s largest agricultural producers themselves, Poland and Romania in particular typically import little to no grain from Ukraine. According to data from the UN Comtrade database, that changed dramatically in 2022, when Ukrainian cereal exports to Romania, Poland, Hungary and Slovakia surged from a total of $24mn in 2021 to $2.4bn last year.

Infographic: A Flood of Grain From Ukraine | Statista You will find more infographics at Statista