Ukraine’s EU accession could strengthen European livestock sector through lower feed costs

Ukraine’s accession to the European Union could benefit the European livestock sector by increasing grain supplies and reducing feed costs, according to a new Rabobank study.

Analysts expect that higher grain production following Ukraine’s integration into the EU could put downward pressure on grain prices. While this may weigh on crop producers, it would benefit dairy, beef, pork, and poultry producers by lowering feed costs.

At the same time, Rabobank does not expect Ukraine’s accession to have a significant impact on the EU dairy, beef, and pork markets. Ukraine produces relatively small volumes of these products, meaning these sectors are likely to remain broadly stable after accession.

The report also notes that the war has significantly reduced Ukraine’s livestock production. Compared with the pre-war period, milk production has declined by 19%, beef by 28%, pork by 8%, and poultry meat by 5%.

Experts emphasize that Ukrainian livestock producers will need to comply with EU requirements on animal health, food safety, animal welfare, and environmental standards before gaining full access to the single market. This will require substantial investment in farm modernization.

Rabobank also argues that Ukraine’s accession would make the current Common Agricultural Policy (CAP) funding model, which is based on per-hectare payments, increasingly unsustainable. The EU would either need to increase its agricultural budget or reform the way farm support is allocated.

The bank considers Ukraine’s accession to the EU by 2027 unlikely. The timeline will depend on Ukraine meeting accession criteria, the EU’s own readiness, and unanimous approval from all member states.

Overall, Rabobank believes Ukraine’s accession would strengthen the EU’s long-term food security and strategic autonomy while creating new opportunities for the agricultural sector, although it would also require significant political and financial reforms.