Polish sugar producers insist on need for quotas on Ukrainian sugar imports

MOSCOW. Jan 30 (Interfax) - Reports from the Ukrainian agricultural sector about the record-high harvest of sugar beet and sugar production have caused panic among European farmers, who hope that Ukrainian sugar exports to Europe in 2024 will not exceed last year's figures of 426,000 tonnes, Ukrainian media said, citing the Farmer.pl media outlet.

Polish farmers are urging the authorities to introduce quotas on Ukrainian sugar exports to the EU as soon as possible.

"I hope that trade issues with Ukraine will be resolved during bilateral negotiations as promptly as possible. Our estimates put Ukraine's export potential in trade with the EU in 2024 at 1 million tonnes. This is the amount that is already undermining our market immensely," director of Poland's National Association of Sugar Beet Growers Rafal Strachota said in an interview with Wirtualna Polska.

Strachota fears that sugar imports from Ukraine may cause Polish sugar refineries to cut production, negatively impacting local farmers, who would have to reduce the area sown with sugar beet.

"Sugar import caps should be imposed. This is the only measure that will allow us to plan the sector's operations, i.e. contracts with farmers and prices," he said.

Ukraine's gross sugar beet harvest in 2023 was 11.8 million-12 million tonnes, the largest since 2018, according to the report. Ukraine produced 1.6 million tonnes of sugar and can export around 600,000-650,000 tonnes in the new season.

Sugar exports from Ukraine between October 2022 and September 2023 were some of the highest in the country's history, Polish specialized agrarian media outlets said. Trade customs duties and quotas were suspended due to the crisis, allowing Ukraine to boost its exports to the EU by 20 times to 462,000 tonnes.

"These data cause serious concern among EU countries. Farmers demand that trade with Ukraine is restricted. Before the start of the crisis in Ukraine, the country exported goods to the EU in accordance with the rules of the Association Agreement," the media outlet said.

"Unilateral additional liberalization of imports from Ukraine (so-called Autonomous Trade Measures, ATM) has now been introduced in line with the EU regulation. It expires on June 5," it said.

Responding to Ukraine's request, the European Commission presented a draft resolution which proposed extending the ATM by a year, until June 2024, but with restrictions on three sensitive groups of goods, such as eggs, poultry meat and sugar.

What is important in this case is the size of quotas and the base year on the basis of which they are established. The base year was 2023, when sugar imports to the EU stood at 426,000 tonnes. It means that Ukraine cannot export more than 426,000 tonnes of sugar to the EU, yet these are not yet official agreements, Polish media said.

"Fear is on the rise among farmers. The sugar beet industry is still one of the most profitable sectors of European agriculture," Farmer.pl said.