EU extends trade support for Ukraine as farmers fear economic fallout

10 Apr 2024 --- European MEPs and the Council presidency have unveiled a provisional agreement to extend temporary trade measures for Ukraine as farmers continue to denounce the current provision as “unsustainable.” The extension includes a suspension of import duties and quotas on agricultural exports for the beleaguered country.

The agreement extends the provisions for another year — until June 5, 2025 — to support Ukraine during its continued war with Russia and includes safeguards that will be automatically triggered and reimpose tariffs on specific agricultural products.

“The ripple effects of Russia’s relentless targeting of Ukraine and its economy are being felt by EU farmers,” says Rapporteur Sandra Kalniete, a member of the European People’s Party, Latvia. “Under this new agreement with the Council, we have fortified safeguards to protect EU farmers in case of market turbulence sparked by Ukrainian imports.”

“By extending the trade support measures for another year, this agreement is also a testament to the EU’s continued solidarity and unwavering support for Ukraine in the face of Russia’s brutal war of aggression until Ukraine’s victory.”

Farmers feel the pinch
However, not all stakeholders are satisfied with the measures. A joint statement by the Association of Poultry Processors and Poultry Trade, the European Association of Sugar Manufacturers, the European Confederation of Maize Production, the International Confederation of European Beet Growers, Copa-Cogeca and the European Union of Wholesale with Eggs, Egg Products, Poultry and Game says the measures do no go far enough to protect EU farmers.

The statement denounces the preliminary agreement as a “half-response” since wheat and barley are excluded from the automatic safeguards put in place to protect EU farmers. 

Several EU agriculture organizations decry the exclusion of grains like wheat and barley from the automatic safeguards.“In the face of Russia’s aggression, solidarity with Ukrainian farmers remains essential,” the statement underscores. “One cannot forget, looking back at the numbers, that with this autonomous trade measure (ATM), the volumes exported to Europe remain substantial.”

“This solidarity cannot rest solely on the shoulders of farmers, and the example of this ATM should collectively force us to better anticipate further measures to integrate Ukraine.”

Help for Ukraine
The provisions were originally proposed in late March. However, some member states called for amendments to the text, spurring new negotiations. The agreement will now have to receive a “final green light” from EU Parliament and Council. The vote is expected to take place in the second part of April’s parliamentary session and, if approved, will enter into force on June 5, the expiration date for the current measures.

The EU Parliament and Council emphasize that these unilateral trade measures will bring stability to the Ukrainian economy and allow for the country’s gradual integration into the EU’s internal market. It also outlines the safeguards, which will be instituted for poultry, eggs, sugar, oats, groats, maize and honey.

Should import volumes for any of those products exceed averages from the second half of 2021 or all of 2022 or 2023, tariffs will resume to help safeguard the livelihoods of EU farmers. Additionally, Parliament reveals it will closely monitor grain imports.

The EU Parliament explains that any significant disruption to the EU market or the markets of one or more EU countries due to Ukrainian imports, such as wheat, the regulation ensures that the Commission can take swift action and impose any measures it deems necessary. 

Grain gambles
The agricultural organizations’ joint statement decries the exclusion of grains from the automatic safeguards outlined by the Commission.

“Especially since without the inclusion of common wheat and barley in the automatic triggering of the safeguard measures it remains unsustainable from farmers and manufacturers’ point of view, principally because this outcome does not reflect the initial outcome of the vote in the European Parliament Plenary on March 13,” the statement reads.

“With the clock ticking, there is an understandable need to find a solution before the expiry of current temporary measures and the Parliamentary break,” the organizations add.

“The attention now shifts to the renegotiation of the association agreement with Ukraine, where we call for better protection of the position of our producers and manufacturers and respect of their standards by Ukrainian producers and processors, due to potential long-term effects.”

By William Bradford Nichols