20 Apr 2022 15:24

Revising export quotas may become EU's major help for Ukraine's agricultural sector - minister

KYIV. April 20 (Interfax-Ukraine) - Steps to abolish quotas for exports of agricultural products from Ukraine to European Union countries or increase the size of these quotas could come as crucial support for the Ukrainian agricultural sector.

"Such major assistance will be to revise the export quotas or to curtail them as much as possible. It will come as crucial support that Ukraine's agricultural business is expecting from countries of the EU. Apart from that, we have submitted a request to ease transit terms in order to be able to use ports in the Baltic Sea and Romanian ports in the Black Sea," Ukrainian Minister of Agrarian Policy and Food Mykola Solskiy said in an interview with the Italian media outlet Adnkronos.

As reported earlier, in 2021 Ukraine fully used all nine quotas for duty-free exports to the EU, namely the exports of honey, grain, flour, starch, processed starch, processed tomatoes, grape and apple juice, chicken eggs, poultry (parts), processed grain products.

Because of the ongoing events, the Ukrainian agricultural sector has been sustaining enormous losses, which are difficult to calculate at the moment, whereas as recently as in 2021 the Ukrainian agriculture, forestry and fisheries sectors accounted for 10.6% of the country's GDP and showed significant growth, the ministry said.

"Tentative data indicate that around 20%-30% of agricultural land may not be sown. The exact figure will become known in late May, when the sowing campaign will conclude," Solskiy said.

In 2022, Ukraine plans to plant more high-margin agricultural crops, i.e. sunflower, soya, oilseed rape, barley, and wheat, whereas smaller areas will be sown with corn, the minister said.

Ukraine planned to export 20 million tonnes of wheat from last year's harvest in 2022, but cannot do so as its seaports are currently blocked, Solskiy said. Ukraine exported 1.4 million tonnes of grain in March 2022, a 3.5-fold reduction from the average pre-crisis export volumes of 5 million tonnes.

"Since the market balance has been disrupted, one ought to be ready that food prices will grow. It will continue until the normal demand-supply balance is restored. Grain supply on the world markets has seriously declined today. And it is not ruled out that high prices for grain will persist for another 3-5 years," Solskiy said.