Kiev believes agricultural export to halt by fall, if Ukraine, EU don't agree on increasing quotas

MOSCOW. June 6 (Interfax) - Ukraine and the European Commission have agreed to develop a solution in June-July 2025 regarding further exports of Ukrainian agricultural products to the European market, Ukrainian press reported, citing First Deputy Agrarian Policy and Food Minister Taras Vysotsky as saying on the sidelines of the Agro Ukraine Summit 2025 in Kiev on Friday.

If a solution is not found during this period, the proposed quotas on agricultural products will start being exhausted based on the 7/12 principle in August-September, and agricultural export to the EU will halt, Vysotsky said.

Restrictions on such products as sugar, poultry meat, honey, bioethanol, wheat, tomato paste, juices, powder milk, and butter are "the most sensitive," he said.

"These are the goods of which Ukraine objectively has a higher export potential than the quotas of 2021. If it is not possible to agree about increasing amounts, there could be a negative impact," Vysotsky said.

One of scenarios of the negotiations is dividing the restrictions into commercial customs codes, which could be a kind of rescue for such products as flour, pasta and others, which fell under the same quota as grain and could be significantly impacted by it, he said.

The Agrarian Policy and Food Ministry estimates the macroeconomic and global influence of the European Commission's restrictions at $3.5 billion, he said.

Vysotsky recommended farmers and traders to actively seek alternative markets to sell their agricultural products.

The EU market is over 500 million of consumers, and Ukraine does not have a special alternative to it, he said. However, the markets of Southeast Asia, India and China, which have a completely different logistics leg, certain restrictions and drastically different significant expenditures, must be considered thoroughly, he said.

Ukraine's agricultural lobby has a goal of defending the Ukrainian agricultural sector as much as possible during the talks, he said.

As reported, the 7/12 formula provides for the calculation of quotas proportionally to the period from June to December, seven out of 12 months of the year, corresponding to the validity period of the current regulation. The formula sets the actual limits of duty-free exports for the second half of 2025.

The decision is part of the general package of the EU Autonomous Trade Measures supporting the Ukrainian agricultural sector. At the same time, it also takes into account the protective mechanisms introduced by the EC for European farmers.

The first Autonomous Trade Measures (ATM) took effect on June 4, 2022, for one year, while all duties, quotas and trade restrictions on Ukrainian goods were scraped. The ATM were extended twice, on June 6, 2023, and on June 6, 2024.

Ukrainian Agrarian Policy and Food Minister Vitaly Koval said at a meeting of the EU's Agriculture and Fisheries Council (AGRIFISH) in Brussels on May 27 that agriculture had been providing 70% of the national GDP since the beginning of the crisis. Therefore, the reinstatement of the EU's pre-crisis tariffs would inflict losses of 2.8 billion to 3.5 billion euros on Ukraine in 2025.