The European Commission agreed on May 3 to impose exceptional temporary bans on Ukrainian grain exports to Central Europe following an outcry from the region’s farmers.
Poland, Hungary, Slovakia, Romania and Bulgaria have in recent weeks imposed unilateral national bans on Ukrainian grain exports, despite criticism from the Commission and other member states that this was against EU rules; these individual bans will now be dropped.
The Commission appears to have headed off pressure from some CEE countries, notably Hungary and Poland, to extend the bans to dairy, poultry and other agricultural products.
The grain crisis has been a huge embarrassment for the EU and in particular for its CEE members, who have otherwise been among the strongest supporters of Ukraine.
To help Ukraine export its grain – export of which through the Black Sea had been impeded by Russia – and to prevent a global food crisis, the EU agreed last year to temporarily liberalise conditions for export via the EU until June 5 and to create “Solidarity Lanes” to expedite this.
However, because of market price movements and logistical bottlenecks, much of this grain remained in the bloc’s CEE members, rather than being exported onwards to the Global South. This glut drove down prices, hurting the region’s farmers, who lobbied their governments for a ban on further imports of Ukrainian grains.
“The surge in traffic at the borders between Ukraine and the EU has had an impact on logistics costs and created bottlenecks, resulting in saturated storage capacities and logistical chains,” the Commission said in a statement. “These exceptional circumstances affect the economic viability of local producers in those member states.”
The Commission has now bowed to pressure from its eastern members and imposed bans on exports of Ukrainian wheat, maize, rapeseed and sunflower seed until June 5 – when the liberalisation period comes up for renewal – under the Autonomous Trade Measures Regulation. These products can only be exported to the five states for onward transit.
The bans are likely to be extended once the EU prolongs its suspension of customs duties on Ukrainian grains, which has already been approved by the international trade committee in the European Parliament and the member states’ permanent representatives to the EU.
The Commission is also planning to organise convoys of trucks, trains and barges to transport the grain to ports where it can be sent onwards.
It is still putting together a financial support programme for the region’s farmers who have been affected by the grain glut. This is reported to be worth around €100mn.
Grain from Ukraine has started flowing again via the Black Sea following a deal brokered by Turkey and the UN. Since then the deal has been renewed for 120 days twice, with the latest renewal due to run until May 18. However, the Kremlin continues to complain that its own grain exports remain restricted and is threatening to cancel the deal rather than renew it again.