Bulgaria insisting that EU introduce quotas for imported Ukrainian agricultural products - media

MOSCOW. Jan 23 (Interfax) - Bulgaria is insisting on introducing tariffs and quotas on the import of Ukrainian agricultural products into the European Union, explaining its demand by saying that the lifting of restrictions on trade in these products has harmed local farmers, Ukrainian media reported, citing Euractiv.de.

"The increase in exports from Ukraine is causing serious concern among producers [farmers], since they are not able to compete with the prices for Ukrainian products," the Bulgarian Ministry of Agriculture told the publication.

Bulgaria is convinced that the maximum volumes of Ukrainian agricultural products should "correspond to market logic and processing capacities, as well as provide greater clarity and confidence for both producers and processors."

The Ministry said that Bulgaria has significant capacity for the production of both refined and unrefined sunflower oil, as well as biodiesel fuel. Bulgarian producers in these sectors are among the largest in the EU. At the same time, Bulgaria does not produce enough sunflower for its production capacity and is heavily dependent on imports from Ukraine.

The introduction of duties on Ukrainian sunflower and rapeseed would complicate the sale of Bulgarian products on the world market. When a ban on the import of a number of Ukrainian agricultural crops came into force last year, some production facilities closed, the Bulgarian Ministry of Agriculture said.

As for the quality of Ukrainian raw materials, the ministry said that in 2023, Bulgarian health authorities inspected them and found them to be completely safe. In addition, sunflower from Ukraine has a higher average oil content than the crop grown in Bulgaria.

To satisfy Bulgarian farmers and oil producers, as well as livestock farmers who rely on cheap imports, the Bulgarian government has proposed that the European Commission set quotas for duty-free imports. If they were to be exceeded, the Bulgarian Agriculture Ministry would insist on paying customs duties on Ukrainian products.

The ministry warns that the current situation could lead to a decline in domestic production, which "could affect the country's food security in the long term."

"The increase in exports from Ukraine is a cause of serious concern for producers, since they cannot compete with prices for Ukrainian goods, which is a consequence of the application of different production standards," the Bulgarian Agriculture Ministry said in a letter.

The Bulgarian government is confident that the European Commission can take measures to protect the markets of EU member states neighboring Ukraine and allow them to use their export potential. One of these measures could be the introduction of tariff quotas on the most sensitive agricultural products as part of the negotiations on the extension of duty-free trade in agricultural products with Ukraine in the spring of 2024.

"For products on which the re-introduction of tariff quotas is not possible, another solution to the problem of increasing imports from Ukraine should be found," the Bulgarian Agriculture Ministry said.

As reported, last week, the agriculture ministers of Bulgaria, Poland, Romania, Slovakia and Hungary, in a joint letter to the European Commission, demanded the introduction of import duties on Ukrainian grain due to dumping prices on it.

The duty-free trade regime between Ukraine and the EU, introduced in 2022 (and valid through June 2024), insofar as it reorients a significant part of Ukrainian agricultural exports to Europe, has led to cheap food from Ukraine ending up in the neighboring countries of Hungary, Slovakia, Poland, Bulgaria and Romania. This has sparked protests from local farmers.

Under pressure from these countries, the European Commission was forced to take special measures in May 2023, banning the import of Ukrainian food into these states (specifically, wheat, rapeseed, sunflower and corn). After the ban expired in mid-September, Hungary, Slovakia and Poland, contrary to the will of the European Commission, introduced prohibitive measures at the national level. Moreover, Poland expanded the list of products prohibited for import to include rapeseed cake and meal, as well as corn bran, wheat flour and derivative products. Hungary's list includes 24 product items. Kiev responded by filing a complaint with the World Trade Organization (WTO). Currently, WTO proceedings are suspended in anticipation of negotiations with the participation of the European Commission.

Negotiations are currently underway on the introduction by Ukraine of a mechanism for licensing the export of its agricultural products with mandatory verification in each of the five countries.