December 21, 2024

Ukraine welcomes EU deal on continued farm exports

By Raf Casert

A truck unloads grain at a grain port in Izmail, Ukraine. U.S. and European officials have toured Ukraine’s southern port of Izmail, a facility that is important in bringing Ukrainian grain exports to the world. It could become critical if a deal with Russia to allow grain exports from Ukrainian Black Sea ports expires without being renewed. (AP photo/Andrew Kravchenko)

BRUSSELS (AP) — Ukraine welcomed the European Union’s hard-fought deal to keep farm exports flowing into and through the bloc to world markets, saying that the Middle East and Africa would specifically stand to benefit from it.

Late in the day on April 28, the 27-nation EU ended a damaging internal standoff over a destabilizing glut of Ukraine farm imports by granting five eastern member countries the right to temporarily ban the most problematic produce while allowing all farm products to transit onward.

Resolving the issue allows the EU to maintain a unified stance in the face of Russia’s invasion of its neighbor.

“We welcome that we resolved this issue,” Ukrainian Finance Minister Sergii Marchenko said at a meeting of EU finance ministers in Stockholm.

Under the deal, Poland, Hungary, Slovakia, Bulgaria and Romania can keep four farm products that make up the overwhelming mass of exports from Ukraine out of their local markets, but must guarantee unfettered access to the rest of the bloc.

Since Russia’s invasion of Ukraine hampered Black Sea shipments of Ukrainian agricultural products, using the 27-nation bloc as a transportation route has been essential to getting the nation’s prized cereal production on to the world.

“We found a wise decision that would help Ukraine to export necessary commodities, food commodities towards African countries, which is so necessary for them,” Marchenko said, adding Middle East nations would equally profit.

Under the deal, the bloc would basically accept the national bans on four of the five main products — wheat, maize, rapeseed and sunflower seeds — that account for most imports.

The EU would also assess whether other products, including sunflower oil, should also be included.

As an added sweetener, the EU provided $113 million more in special aid on top of on an initial support package of $62 million to help farmers in the affected countries.

Also on April 28, EU nations tentatively agreed to lift tariffs on Ukraine’s grains for another year.

The EU lifted duties on Ukrainian grain to facilitate its transport to Africa and the Middle East by other routes after a Russian blockade kept cargo from leaving Ukraine’s ports.

Overall, there was acceptance that the lifting of import tariffs had seriously skewed the local markets in nations closest to Ukraine.

In Poland, wheat imports went from 2,375 tons in 2021 to 500,008 tons last year. Maize went from 5,863 tons to more than 1.8 million over the same period.

Similar huge increases were also evident in Hungary, Slovakia and Romania.

MarketsPoliticsUkraine