Poland and Hungary have banned the import of Ukrainian cereals in a move described by the European Commission as “unacceptable”. The two nations consider the imports to be destabilising their internal markets.
The European Commission says that it is “considering” a second aid packet for affected farmers. In May 2022 the EU decided to suspend all customs duties on products imported from Ukraine to support the Ukrainian economy, which remains heavily reliant on the agricultural sector. This even paved the way for new routes for grain to arrive in Europe over land, following Russia’s blockade of the Black Sea.
Countries bordering Ukraine have seen a rise in cheap grain entering their territory, mostly wheat and sunflower. Much of this is stored in silos in neighbouring countries, where logistical problems mean that it gets stuck in the foreign market, causing the price of locally harvested products to plummet.
For several months, Polish farmers from across the country have been protesting against these imports, which they say undercut their own livelihoods. Ukrainian grain is intended to simply travel through Poland to other countries as part of “solidarity routes” but Budapest and Warsaw jointly announced that they would ban the import of Ukrainian cereals in solidarity with their farmers.
The ban includes other agricultural products from Ukraine and will be in place until 30 June.
Undercutting domestic production
The Commission has reacted angrily to what it described as “unilateral actions” by the two nations. “It is important to underline that trade policy is of EU exclusive competence and unilateral actions are not acceptable,” noted commission spokesperson Miriam Garcia Ferrer.
European authorities have reportedly requested additional information to assess whether the declaration is in breach of EU law. The Polish ban will apply to cereals, sugar, meat, fruit and vegetables, milk, eggs, and other food products. In Hungary, the ban will apply to cereals, oilseeds, and several other food products.
EU officials have been aware of competition problems surrounding Ukrainian grain in the eastern Member States. On 20 March, Brussels offered to mobilise €56.3 million to support affected farms in Poland, Romania, and Bulgaria. Other countries have also demanded increased support.
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For its part, Ukraine has reacted angrily to the decision. In talks between Ukrainian farming minister Mykola Solsky and his Hungarian counterparty Istvan Nagy on Sunday, the Ukrainian minister publicly rebuked the ban. The two parties will soon engage in new talks.
Last year, the value of European imports of Ukrainian agricultural products jumped by 88% in the space of a year, driven by the price of grain. With the loss of the Russian market due to sanctions, the volume of imports also increased tenfold. Faced with this surge, many national producers are finding it hard to compete with Ukrainian goods, especially when they are exempt from tariffs and levies.
