After Russia closed the Black Sea export route, Ukraine, the world’s granary, had a huge surplus in its hands. It was taken to the EU area, and now some countries are in trouble.
Poland, Hungary, Bulgaria and Slovakia have announced in recent days that they will impose import restrictions on grain and other agricultural products from Ukraine. Import bans and restrictions are temporary and are scheduled to expire at the end of June.
To make it easier for the neighbors to gather, the EU is currently preparing an aid package of 100 million euros, which would be aimed at helping farmers in Eastern Europe. However, the package still requires the approval of all member countries.
How did the controversy shaking Eastern Europe start?
The Black Sea trade routes were cut off
After Russia started a large-scale war of aggression in Ukraine in February of last year, trade through the Black Sea stopped.
The world panicked, because it was not an insignificant trade route: Ukraine is one of the world’s most important food producers. Even in the middle of the war, the country is still one of the biggest exporters of corn, wheat and other grains and poultry, says (you switch to another service) Politico.
So when the Black Sea trade route closed, the EU promised to help Ukraine export the millions of kilos of grain stuck in the country to the world.
Reuters told (you switch to another service) at that time, how in Brussels all the customs fees and checks that products coming from Ukraine had been subject to until now were abolished. The intention was that Ukrainian products would be exported to the world through the Union.
Now it has been noticed in Ukraine’s neighboring countries that the grain brought from the country does not always go forward. Part of it remains in the member countries, where it is sold cheaply. In fact, so cheap that some of the producers have noticed this spring that they cannot compete with the prices.
Polish farmers drove the minister out of office
Polish farmers in particular have been in trouble this spring. The situation has led to protests and the resignation of the Minister of Agriculture.
According to farmers, the importation has resulted in an unexpected amount of grain flowing into the market, which competes directly with Poland’s domestic production. Cheap grain imported from Ukraine is pushing down the price of local grain, which is why producers have been struggling.
A similar story has also been heard from Bulgaria.
Politico told (you switch to another service) in January, how farmers are not making money growing sunflower seeds, as a 20-fold increase in Ukrainian imports has reduced prices by almost half compared to before.
The European Commission is now rushing to the aid of Eastern Europe.
Politico by (you switch to another service) The EU’s plans concern some kind of assistance in moving grain onward from Ukraine’s neighboring countries, where it is currently accumulating. According to the publication, the commission said it would consider the possibility of customs duties on agricultural products later.
It is feared that the import bans will affect Ukraine’s already weak economy and thus the country’s defense capabilities.
Russia allegedly reneged on the agreement
Another route for Ukrainian grain out of the country is through the Black Sea. Although the UN, Turkey, Russia and Ukraine reached an agreement on grain transport last summer, even the route has not been without problems recently.
According to the agreement, Ukraine is allowed to transport its products from three Black Sea ports, and all parties to the agreement are allowed to inspect ships leaving Ukraine for the world via the Black Sea. The idea is to ensure that ships are not used to transport weapons.
However, Ukraine has accused Russia of delaying inspections, which has led to export problems. Reuters sources by (you switch to another service) Earlier this month, for example, Russia started demanding daily random inspections of ships.
Guardian told (you switch to another service) on Wednesday that ship inspections returned to normal “despite Russia’s attempts to violate the agreement”, as the Ukrainian minister Oleksandr Kubrakov formulated the matter.