EU limits customs exemption for Ukrainian grain

28 March 20242 min reading

The European Union has decided to maintain its customs exemptions for Ukraine, on condition that it sets quotas for some products. Kyiv has voiced discontent with these limitations, asserting that they are projected to result in losses totaling €330 million for war-torn Ukraine. The EU initially lifted import duties and quotas on Ukrainian agricultural products in 2022, in response to the Russian invasion that disrupted grain shipments across the Black Sea.

The European Parliament has approved an agreement granting Ukrainian agricultural producers duty-free access to European Union (EU) markets until June 2025. However, the agreement envisages limits on the quantities of some agricultural products. Accordingly, an ‘emergency brake’ will apply to imports of poultry, eggs, sugar, oats, corn, cereals, and honey from Ukraine. If the quantities of these products imported into the EU exceed the average import values for 2022 and 2023, customs duties will be levied on them. Wheat imports will not be subject to customs duties in the first phase, but if imports exceed a certain amount, customs duties may be imposed. The agreement will also streamline the process for member states to implement ‘remedial measures’ in response to market disruptions. This broad term may pave the way for national-level bans.

In response to Russia’s aggression against Ukraine, the EU lifted tariffs and other trade restrictions on Kyiv in June 2022. However, the arrival of duty-free grains flooded the markets of neighboring countries, such as Poland, Hungary, Slovakia, Romania and Bulgaria, triggering the fury of local farmers, who saw the low-cost Ukrainian imports as unfair competition. The governments retaliated by imposing unilateral bans, which the EU Commission considered unlawful.

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