CEE leaders say EU may need to reintroduce farm tariffs on Ukraine

Romania, Poland, Hungary, Bulgaria and Slovakia expressed concern in a letter to the European Commission (EC) on Friday over an “unprecedented” increase in the number of Ukrainian grains, oilseeds, eggs, poultry and sugar in their countries.

Large quantities of cheaper Ukrainian grains have been redirected to countries in Central and Eastern Europe (CEE) since Ukraine’s Black Sea ports were blocked after Russia’s invasion on 24 February 2022, negatively impacting the prices and sales of local farmers. 

In the letter co-signed by the five prime ministers – Bulgarian Rumen Radev, Polish Mateusz Morawiecki, Hungarian Viktor Orban, Romanian Nicolae Ciuca and Slovak Eduard Heger – the CEE premiers request the mobilisation of new EU financial instruments, beyond the planned extraordinary measures – to support the agricultural producers who have suffered losses.  

Over 450,000 tonnes of grain from Ukraine is currently being transported through Poland monthly, a 16-fold annual increase, Polish Infrastructure Minister Andrzej Adamczyk told the European Bank for Reconstruction and Development this week.

To limit market distortions, the CEE premiers called for joint solutions between the EU and the World Food Program, more funding for farmers, faster development of transport infrastructure, and changes to import laws to regulate the inflow of agricultural products. If these measures fail, they warned that tariffs and tariff quotas may need to be reintroduced.

CEE leaders unimpressed by EU compensation package

The joint letter was sent after an EU farm aid package left politicians and farmers in CEE decidedly nonplussed. The EC last week decided to compensate six countries that have faced an influx of Ukrainian grain that lowered local prices as a result of EC policies.

The EC has already allocated EUR 29.5mn to Poland, EUR 16.75mn to Bulgaria, and EUR 10.05mn to Romania, and authorised them to match these amounts with state aid. The other three countries due to receive aid are Hungary, Czechia and Slovakia. 

The proposal, discussed at the Agriculture and Fisheries Council meeting on March 20, was submitted to the 27 member states for approval during a technical meeting on Thursday 30 March. 

EU acknowledges role in farm crisis in CEE

EC President Charles Michel recognised Romania’s role in creating alternative export routes for Ukraine, saying “I know that this has had a negative impact on Romanian farmers. We should consider increasing this amount.”

Poland’s Prime Minister Mateusz Morawiecki meanwhile backed Polish farmers demands that a larger compensation payment will be needed. Facing an election later in the year, Morawiecki, whose PiS party counts farmers as a key voter base, tweeted “let us support Ukraine, but let’s do it wisely and, above all, priorities the interest of the country and Polish farmers.”

Romanian minister supports local farmers

Ahead of EU members voting on the farm aid package on Thursday, Romanian Agriculture Minister Petre Daea told local media that “work will be done on a new support mechanism to supplement the amounts destined for our country, as requested by the Romanian President.”

The instruments will compensate drought losses to spring crops, Daea said, adding that the first payment will be distributed to farmers immediately after the approval of the state aid by the EC.

“Out of respect for Romanian farmers, we are doing everything necessary to get the sums to them on time. We are working together with the dialogue partners to establish the application methodology,” he added.

“After the approval of the mechanism with the EC, we will set in motion the normative act that we have already created in the ministry. We are ready and I estimate that the payments will be made in the coming months,” Romania’s agriculture minister said. 

However, the size of the compensation payments has brought dissatisfaction in CEE. Daea himself called Romania’s compensation “ridiculous” after a European Council meeting in Brussels on March 2, adding that he had asked the European Commissioner for Agriculture Janusz Wojciechowski to rethink the calculation formula. 

“I argued at the Council, in the discussion with the European Commissioner for Agriculture (who) explained to us the constraints, justifying that the Commission’s decision was to grant only EUR 56mn of the total crisis reserve of EUR 450mn. 

Romanian farmers protest in Brussels

The Romanian Farmers’ Association (AFF) announced on Wednesday that its representatives are in Brussels to raise an alarm before the European Commission and the European Parliament regarding the difficult situation in which representatives of the agri-food sector in Romania find themselves. 

“Today, March 29, 2023, the AFF delegation displayed a banner in front of the European Commission with the message: “Romanian Farmers deserve respect!” ahead of an EC technical meeting at the level of the European Commission to discuss the recalculation on Thursday.