Espreso. Global

On Ukrainian grain, economic miscalculations and elections in Poland

20 April, 2023 Thursday

There are signs that the ban on imports of Ukrainian agricultural products to Poland, Hungary, and Slovakia will soon be lifted. Officials in the European Commission are already discussing possible options. Ukraine and Poland have agreed on the terms of transit of Ukrainian grain through the territory of our western neighbor

As a result, the Ukrainian agricultural sector will not suffer too much. This is extremely important because it is the sector that keeps our economy alive during a large-scale war. 

Let's also hope that in May, the "customs visa-free regime" that the European Union introduced a year ago will be extended for another year. However, in Poland and some other countries, opposition politicians continue to claim that this decision has been a mistake and that duties should be reintroduced. 

Parliamentary elections will be held in Poland and Slovakia in the fall, so such voices will be heard often and loudly, influencing public policy. They will also affect the negotiations on Ukraine's accession to the EU, which will be neither easy nor pleasant. We can be sure that each of our western neighbors will fiercely defend the interests of their economies, including agriculture.

True figures

So, we have to state that the "honeymoon period" in our relations with our allies, who have provided and continue to provide us with great assistance, is over. We are deeply grateful for it. However, we have to draw the right conclusions from the crisis that arose after Saturday's decision of the Polish government. We have to be as honest and open as possible, and we demand the same from our partners. 

The crisis in Polish agriculture was not caused by Ukrainian grain and other agricultural products. It was caused by the miscalculations of the Polish government and Polish farmers, not by the "Armageddon" of the influx of Ukrainian agricultural products. 

Marek Sawicki, a former Polish Minister of Agriculture and one of the leaders of the opposition Polish People's Party (he is an opponent of "customs visa-free travel"), said that 10 million tons of grain should be exported from the country before this year's harvest. The Polish media, following the leaders of the farmers' protest, reported that 4 million tons of Ukrainian grain were stored in warehouses and storage facilities.

But this is not true. Denys Marchuk, deputy head of the All-Ukrainian Agrarian Council, cites other figures: Ukraine sold 700,000 tons of wheat and about 1 million tons of corn to Poland during the year. And he states, "These are not the figures that affect strategic indicators and harm the sale of their own grain." 

How to sell and export Polish grain  

Sales of Polish grain (5 to 8 million tons) are hampered by three problems: low prices, low throughput capacity of Polish ports, and lack of space for exports. On the eve of last year's harvest, Deputy Prime Minister and Minister of Agriculture Henryk Kowalczyk (who was dismissed a few months ago) advised farmers not to sell grain because its price would rise in the spring. They listened to him and did not sell their crops, but the price fell dramatically, and farmers were left with millions of tons of grain.   

To save the situation in agriculture and its electoral chances among rural residents, the ruling Law and Justice party imposed an embargo on imports of Ukrainian agricultural products and promised to buy grain from Polish farmers. The EU also promised financial assistance. 

But there was no one to sell the grain to and no way to export it. That's why Sawicki suggested that the EU should buy the Polish grain and send it to countries in Africa and the Middle East as part of a humanitarian mission. Will Brussels implement this decision? We'll see, but once again, it should be emphasized that it is not Ukrainian grain, but Polish grain that is being sold. 

Ukrainian grain needs reliable transit conditions to its destinations, because, fortunately, there are no more problems with sales. At the same time, transportation is not free, it is paid for at a reasonable price, and Polish carriers also make money on it. 

Likewise, the purchase of Ukrainian grain is based on economic calculations, not on the EU's voluntaristic decision to introduce a "customs-free regime." Our producers have conquered global markets since the outbreak of the Russian-Ukrainian war in 2014 thanks to the high quality of their products and competitive prices.

All agreements have been violated 

That is why I am particularly outraged by the intimidation of Polish society with claims of importing large quantities of "technical grain" from Ukraine in the campaign to help Polish farmers. And the nonsense about it allegedly being added to flour, which "poisons Poles" since it uses banned pesticides. Because, no one knows for sure how much of this grain was imported and whether it was even used in bread baking. But the gossip took on a life of its own, overshadowing seemingly exemplary Ukrainian-Polish relations.    

Other Ukrainian products (fruit, including frozen fruit, honey, etc.) compete in the very demanding and highly regulated EU market. It should be borne in mind that all products of farmers and agricultural producers in the EU are subsidized in various ways from the organization's budget.

Always keep in mind: the embargo on imports of Ukrainian agricultural products violated international agreements (within the framework of the World Trade Organization), EU internal legislation, and the free trade agreement between Ukraine and the EU. This was implemented without warning and without good reason. The "Ukrainian grain" case is just a pretext, not the real reason for the crisis with Polish grain and agricultural products.    

In conclusion, I would like to appeal to my Polish friends, of whom I have many, both in the government and in the opposition. Do not use dishonest methods to solve the problems of your own economy and agriculture. Poles and Poland have captured the hearts of Ukrainians and surprised the world with unprecedented support for Ukraine after February 24, 2022. And this achievement should not be destroyed in the sake of temporary political and electoral gain. 

I wish Polish farmers and agricultural producers a speedy end to the current crisis.

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