Ukraine weighs in on the impact of reinstated EU tariffs on agriculture

The looming withdrawal of EU wartime trade waivers promises to deal a heavy blow to Ukrainian agricultural exports, with poultry farmers expected to be among the main losers.

According to Ukraine’s finance ministry, the preferential trade regime secured around 10% of export revenue for the war-battered country. If the duties are re-imposed as planned, it could cost Ukrainian farmers up to €3.5 billion annually, Danylo Getmantsev, chairman of the Verkhovna Rada Committee on Finance, Tax and Customs Policy, has written in a statement on his Telegram channel.

Poultry farms and sugar factories will be primarily hit by the EU decision to revert to pre-war tariff quotas on agricultural exports after 5 June, Alexander Verzhikhovskiy, CEO of IMK, one of the largest Ukrainian agricultural holding companies, was quoted as saying by local news outlet UkrAgroConsult.

Both industries rely heavily on exports to Europe, Verzhikhovskiy admitted.

MHP, the leading Ukrainian poultry processor, also warned about the heavy impact of the reinstated EU tariffs on its business.

“The current free trade regime allows us to ensure stable supplies of high-quality Ukrainian-made products,” said Yuriy Melnik, deputy CEO for Sustainable Development at MHP, who also emphasised that the poultry exports are an integral part of the mutually beneficial agricultural trade.

“For every €1 of exported products, Ukrainian poultry producers import approximately €1.38 in goods and equipment from the EU,” Melnik said, admitting that the withdrawal of the waivers will have negative consequences for long-term contracts and investments in the industry.

The preferential trade regime has allowed Ukraine to gain a significant foothold in the EU market. According to official information, Ukraine exported agricultural products worth €13.1 billion to the EU, accounting for 6.7% of the bloc’s agricultural imports last year. In 2020, exports amounted to only €5.8 billion, which comprised only 4.8% of EU agricultural imports.

To compensate for the loss, MHP intends to increasingly focus on alternative markets, Melnik said, without providing additional details. Other key market players have embarked on similar plans.

“Our strategy will be focused more on North Africa, the Middle East and China,” Verzhikhovskiy revealed.

In 2024, Ukraine exported 446,600 tonnes of poultry meat, 6% up compared with the previous year, the Ukrainian Union of Poultry Farmers said. Of this figure, the EU accounted for 30.5% or 136,200 tonnes, the Union calculated.

Tags: Ukraine, EU, sugar, Poultry, agricultural exports, imports