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22 Feb. 2024

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Why has Ukrainian grain become a problem for Europe?

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Why has Ukrainian grain become a problem for Europe?

The conflict over Ukrainian grain has been ongoing for a year. Recently, the Polish demonstrations escalated, reaching a new stage when for the first time railroad traffic was temporarily suspended. The organizers of the protests threaten to blockade even passenger transportation and intend to continue the protests. Find out why Ukrainian grain has become a subject of controversy in Europe

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The grain crisis between Ukraine and Poland has been going on for almost a year. However, this week, the Polish protests reached a new level, because for the first time, the railway connection was blocked for a certain time. The organizers of the action threaten to prevent even passenger transport and plan to hold protests until April 2024. Given that the Poles do not allow even trucks with military and humanitarian aid to pass, such actions significantly affect the economy and security of Ukraine.

In response to the blockade of trucks by Polish protesters, Ukrainian carriers started their own protest action at three checkpoints.

In order to find a way out, the President of Ukraine Volodymyr Zelenskyy proposed to the President of Poland Andrzej Duda and the Prime Minister of this country Donald Tusk to hold meetings at the state border in the coming days in order to unblock the movement of Ukrainian goods. And also called on the European Commission to join in solving this issue. The Ukrainian authorities believe that blocking the border is an exclusively political issue.

Why has Ukrainian grain become a problem for Europe? We talk about the causes and consequences of protests on the Polish-Ukrainian border in our article.


History of protests on the Ukrainian-Polish border


In May 2022, as a sign of support during a full-scale russian invasion, the EU zeroed out all tariffs and quotas on Ukrainian exports. Such actions actually opened the market for Ukrainian manufacturers as if Ukraine were already in the EU.

However, in the middle of the spring of 2023, Polish farmers began to complain about the drop in prices, which, they say, was caused by a wave of imports from Ukraine, which flooded warehouses, wagons and ports. In April, Poland banned the import from the territory of Ukraine not only of grain, but also of almost all agricultural products - vegetables, dairy products, honey, oil, eggs and even wine. The European Commission has not yet received any confirmation that it is Ukrainian products that do not allow Polish farmers to make a profit. However, the actions of workers in the agricultural sector of Poland continue.

Blockade of buses, trucks and trains by Poles and Ukraine's response. Read more about the protests at the border here.


Renewal of protests by Polish farmers


In 2024, farmers' protests, accompanied by the closure of border checkpoints, began on February 9. Almost immediately after the end of the two-month blockade of the Ukrainian border by Polish carriers, who demanded the renewal of permits for Ukrainian drivers to work in the EU, they say they cannot stand competition.

On February 18, farmers blocked 6 out of 9 checkpoints: "Yagodin", "Ustylug", "Ugryniv", "Rava-Ruska", "Sheghini" and "Krakivets". At the same time, 4 of them are the largest, through which trucks weighing more than 7.5 tons can pass.

From February 20, Polish farmers agreed to block all border checkpoints with Ukraine for a whole month.


What do Polish farmers demand?


So far, the protesters have put forward three demands:

- Not to join the "green transition" of the EU, which involves limiting the use of pesticides and fertilizers. Its implementation, according to farmers - and not only Polish farmers - will make production even more expensive despite the fact that income from the sale of agricultural products does not increase. That is, with higher expenses, farmers will receive less and less income.

- Ban the import of Ukrainian agricultural products (poultry meat, sugar, sunflower oil, eggs and other products);

- To support domestic animal husbandry.




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What is Ukraine losing?


In 2022, Ukraine received $20 billion in profit from the export of agricultural products. This is certainly half less than in the pre-war years. However, these exports became the main source of foreign exchange for the country during the war. For comparison, the export of IT services brought Ukraine $7.34 billion in 2022. More than 50% of the goods were exported to the EU. Also, almost half of all agricultural products are grains.

About 10% of Ukrainian agricultural exports went through Poland, 6% - through Hungary, and 1.5% - through Slovakia.

In general, the head of the parliamentary committee on finance, tax and customs policy, Danylo Hetmantsev, noted that if the border is blocked until the end of February, the budget of Ukraine may not receive UAH 7.7 billion.


Does Poland export its agricultural products to Ukraine?


The Minister of Agriculture and Rural Development of Poland, Czeslaw Sekerski, has already warned that the complete closure of the Ukrainian border by farmers could stop Polish exports to Ukraine, and therefore lead to the loss of many jobs.

According to the State Customs Service, in 2023, Poland exported $6.6 billion worth of goods to Ukraine, while Ukraine exported $4.8 billion worth of goods to Poland.

A large share of trade between the two countries is agricultural and food products. Cat and dog food is the basis of Polish products in Ukraine. The state also exports dairy products, primarily cheese, cookies, sauces, frozen and canned vegetables.

That is why the blockade of the border from the Ukrainian side can also harm the Poles.


Is it a question of competition?


Perhaps the reason for blocking is not political reasons or protection of the Polish national market, but competition for consumers in the EU?

The other day, Poland's deputy minister of agriculture, Michal Kolodzejczak, said that the country's government is concerned that Ukrainian agricultural products are displacing Polish products on the German market.

The Polish Ministry currently sees only two ways to solve this problem:

1. Quotas should be introduced for goods from Ukraine entering the EU.

2. It is necessary to make its transportation outside the EU more efficient.

The department notes that Ukraine is a strong competitor, and although the import of agricultural products to the Polish market is currently prohibited, Poland is concerned that it is gradually being pushed out of Western European markets.


Incidents on the Ukrainian-Polish border that shocked this week


While politicians are trying to find a way out, Ukrainians, farmers and women with children are suffering. In particular, this week the society was shocked by two actions on the part of Polish protesters:

● On February 20, at the Medyka railway station (Poland), protesters opened the hatches of two UZ freight cars and poured Ukrainian grain out of them.

According to the press service of "Ukrzaliznytsia", they are outraged by such actions of Polish farmers, because the company adheres to the ban on the import of grain to Poland, which was introduced in April 2023. All wagons at the border are checked by Polish control authorities and sealed. Such actions make it impossible for Ukrainian grain to enter the Polish market in Poland. These goods are transported through the territory of the country exclusively by transit. In particular, the lost grain was headed for Germany.

Currently, there are about 40 Ukrainian freight cars with agricultural products at the Medyka station.

The Ministry of Agrarian Policy and Food of Ukraine also responded to the situation and invited Polish farmers to Ukraine to see the conditions under which farmers in Ukraine currently work. 4 million small farmers in Ukraine are ready to share their experience with their Polish colleagues. The department emphasizes that they will closely monitor the investigation of this incident.


● Also on Sunday, February 18, in Dorohusk, protesters did not allow passenger buses and the "Kyiv-Helm" train, which were almost exclusively women and children, to pass. After the intervention of the police and railway workers, the passage was unblocked. This was the first case of blocking passenger transport.


Ukraine is looking for alternative ways to export grain


While Poland is protesting, Ukraine is looking for a way out on its own. In particular, it is planned to start exporting products across the Danube to Romania in the coming days. It is predicted that this route will increase exports to pre-war levels. This was announced by the Minister of Infrastructure of Ukraine Oleksandr Kubrakov.

The proposed route will run from the Ukrainian port of Izmail to the Romanian Constanta and the Danube ports of Germany. A second large-tonnage SLG barge has already been built for cargo delivery.


And although the situation is quite complicated, I would like to believe that the leadership of Poland and Ukraine will be able to reach a compromise, find ways to solve this issue, and the grain dispute will not destroy the Polish-Ukrainian alliance.

Want to know more? Read the latest news and useful materials about Ukraine and the world in the News section.




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