Tariff-free Ukrainian grain angers Eastern European farmers

Ukraine’s grain, the fruit of its fertile and coveted black soil, could open the first cracks in the common front of European solidarity with Kyiv against the Russian invasion. A few months after the Kremlin launched the full-scale war, the European Union waived customs duties and import quotas on Ukrainian goods (including grain). It was intended as an economic lifeline and as a formula to fight the global food crisis fueled by the Russian blockade of one of the granaries of the world.

But now, five of Ukraine’s Eastern European neighbors — Poland, Romania, Slovakia, Hungary and Bulgaria — have mobilized to demand funds and other tools from the European Commission to offset the “negative effects” of the increased presence of Ukrainian agricultural products in their own markets, or else to reinstate tariffs.

In a letter to the EU executive, the heads of state and government of the five countries said that the absence of duties on grain from Ukraine and the problems in getting the product to travel through the so-called EU Solidarity Lanes (created as an alternative to the blockade of Ukrainian ports, to help Ukraine export its agricultural produce to its intended destinations worldwide) are causing major bottlenecks, flooding their own markets, driving down prices and harming their farmers. The letter to the President of the European Commission, Ursula von der Leyen, said there has been an unprecedented increase in imports of cereals, eggs, poultry, sugar, apples, flour, honey and pasta in the countries bordering Ukraine.

Brussels last week deployed €56 million in financial aid from its crisis reserve fund for Polish, Bulgarian and Romanian farmers. And it is considering launching a second aid package, according to a spokesperson for the European Commission. In February, Brussels proposed extending the removal of import duties on Ukrainian products until June 2024. Suspending this regime would require the approval of the EU’s member states, although some officials, such as EU Agriculture Commissioner Janusz Wojciechowski, who is from Poland, have already expressed support for this option. But Brussels so far does not support a change of plans, since it does not view this market disturbance in Eastern Europe as affecting the EU as a whole.

Eastern European farmers are furious. In Poland, which seems to be one of Kyiv’s staunchest allies in the EU, protests by farmers in various parts of the country somewhat marred the Wednesday visit to Warsaw by Ukrainian President Volodymyr Zelenskiy. Shortly before the arrival of the Ukrainian leader, the Polish Minister of Agriculture Henryk Kowalczyk handed in his resignation, mentioning the impossibility of making progress on a deal to reintroduce tariffs. Aware of the risks of eroding Polish citizen support for Kyiv, Zelenskiy alluded to the grain crisis during his visit. “We have found a way out of this situation, in the coming days, weeks, it will finally be resolved,” he said after a meeting with Polish Prime Minister Mateusz Morawiecki.

Ukrainian grain imports increased in Poland from about 100,000 tons a year on average to more than two million tons in 2022, according to government data. Trade unions and farmers’ unions say that if the ultra-conservative Law and Justice (PiS) executive does not announce new aid measures soon, there will be massive protests after the Easter holidays. Monika Piątkowska, president of the Polish Chamber of Grain and Feed, blames the government’s inaction and the global situation, and claims that Ukrainian grain is not to blame. But some voices fear that solidarity with Ukraine will crack in an area of the world that stood out for its support in the early stages of the invasion.

There are already some signs that the situation is changing. Poland, which has hosted 1.3 million people who fled the war launched by Russia, has cut funds for aid programs in half and has begun charging some refugees for accommodation.

In Poland, as in Slovakia, there are parliamentary elections in the fall. And that also plays a role, although both countries are designated as champions in supporting Ukraine. “Let’s support Ukraine, but let’s do it wisely and, above all, put the interest of Poland and Polish farmers first,” Polish PM Morawiecki said on Twitter recently.

In Bulgaria, where in recent days farmers have tried to block customs checkpoints with Romania in a wave of protests, imports of Ukrainian grain ballooned from 361 tons to more than 16,700 tons. At the last meeting of the European Council in late March, Romanian President Klaus Iohannis complained that the EU executive was not adequately taking into account in its aid distribution the country’s “enormous sacrifices” to facilitate the export of cereals from Ukraine. Its farmers have announced protests for this coming Saturday.

Ukrainian cereal exports to Europe will be reduced this year. Ukrainian farmers have planted much less, not only because part of the land has been occupied by Russia, but also because of the insecurity of working in a country under constant attack.

Beyond the recent problems with Ukrainian grain, complaints from neighboring countries have brought to the fore the tensions that Ukraine’s potential EU membership would spark. Ukraine applied for EU membership in February 2022 and was granted EU candidate status in June 2022. If successful, it would become the union’s largest member, with an agricultural land surface equivalent to all of Italy, meaning it would obtain a large share of the aid from the Common Agricultural Policy, which is distributed among member states according to their cultivated area. Some countries are already talking about the need to reform the system if the club is expanded.

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