European farmers approve quotas for Ukrainian grain, but market remains tense

European farmers have welcomed the European Union’s introduction of quotas for Ukrainian wheat and barley as a small boost to their market. But they still face global price competition as Ukraine tries to export to other regions, Reuters reports.

The quotas should redirect Ukrainian exports from Europe and keep more European wheat on the domestic market, although the benefit to farmers in terms of higher prices may be limited, traders say.

One trader, who asked not to be named, said Ukrainian grain not shipped to the EU would still end up on the world market.

The reduced access to the EU’s vast market has been a blow to Ukraine, but it has the opportunity to refocus more on North Africa and Southeast Asia, First Deputy Minister of Agricultural Policy Taras Vysotsky told reporters.

“We were there in 2021, and logistically it’s not difficult. The only question is the price,” he said.

Meanwhile, the EU and Ukraine are working on a broader trade deal.

The EU’s agriculture commissioner told Reuters that the future deal would include quotas that would be somewhere between the current levels and those that were in effect during the concessions.

Ukraine’s trade representative, Taras Kachka, stressed the risk of market tensions.

“There will be no problems with corn supplies, but there are issues with wheat and barley, and we hope to achieve acceptable volumes,” he said on Friday at a grain conference in Kyiv.

Ukrainian corn is subject to a pre-war annual quota of 650,000 tonnes from Friday. But unlike wheat and barley, no impact is expected because corn is subject to a general zero tariff in the EU.

Tags: EU, prices, wheat, restrictions, Ukraine, grain, barley