Exports of soybeans and rapeseed in Ukraine are blocked: market is waiting for the government’s decisions

UkrAgroConsult

On September 10, the Ukrainian government and business representatives held an emergency meeting to address the new export mechanism for soybeans and rapeseed after the 10% duty came into effect. Experts stress that the minimum step should be providing guarantees for duty refunds to farmers exporting their own crops. This requires clear criteria for verifying producers and the origin of grain.

The soybean and rapeseed amendments came into force on September 4. By September 7, rapeseed exports had effectively stopped, as customs authorities canceled all periodic export declarations, including those exempting producers from duty payments. As a result, around 500,000 tons of rapeseed and a similar volume of soybeans remain blocked.

Industry associations are calling to suspend or postpone the law, arguing that the current mechanism does not work. Farmers are unwilling to pay the duty without guarantees of refunds, while exporters refuse to cover the costs themselves. This creates risks of contract defaults and threatens the start of the soybean export season in October.

The Ministry of Economy has been tasked with developing clear criteria for identifying producers and the origin of products, as well as a mechanism for refunding the paid duty. The ministry is currently drafting amendments to the law together with business and industry associations, after which the document will be submitted to Parliament. However, the approval process may take at least two months, leaving businesses in September and October working “at their own risk” with no guarantees.

According to UkrAgroConsult, no fast solutions should be expected. Technical constraints will remain until either the exemption mechanism is clarified or the duties are amended or lifted. One way to resume shipments is to pay the 10% duty now in hopes of a later refund, but this means working capital losses and the risk of delayed compensation.

Analysts add that the price gap between domestic and export markets will likely widen. Crushers are expected to gain stronger leverage, while farmer sales will remain cautious. Mixed cargoes (exempt and non-exempt) also remain a problem, as no clear clearance procedure exists. Even if Parliament considers amendments in October, real changes may only take effect from November. The best-case scenario, in UkrAgroConsult’s view, would be a temporary suspension of duties by a special government act, but even this would take time.

In addition, Ukrainian soybean exporters will face competition in the European market from U.S. suppliers, whose volumes are redirected to the EU after China imposed tariffs on American beans. For rapeseed and processed products, Ukraine will compete more strongly with Canada, which is seeking new sales markets in Europe after losing access to China.

Tags: Ukraine, export, soybean, rapeseed, duties, restrictions