Following fierce farm protests over gluts of Ukrainian grain and other food items in their domestic markets, four European Union countries—Poland, Slovakia, Bulgaria, and Hungary—have temporarily imposed import restrictions on key agricultural products from Ukraine. Restrictions in Bulgaria entered into force on April 24, and Romania, another EU member, has considered similar measures. The countries’ governments have stressed that these bans are temporary and imposed out of concern for their own farmers, who are seeing prices and incomes fall.
This unfolding situation has arisen because of problems with so-called “solidarity lanes”—alternate export routes from Ukraine through Europe set up in response to shipping disruptions from the Russia-Ukraine war. As Ukrainian food exports pile up in Eastern Europe, they are not reaching their intended destinations, posing risks to food security in poor countries.
Why are Ukrainian food exports hurting farmers in these EU countries?
Before the Russian invasion in February 2022, nearly all of Ukraine’s exports of cereals, oilseeds and vegetable oils were shipped from its ports in the Black Sea area. But Russian attacks damaged port and other transportation infrastructure, and mines and Russian warships near Ukrainian harbors made Black Sea routes too dangerous for shipping.
Cereal exports dropped by more than half, to about 1.5 million metric tons per month, during March-July 2022 compared to the first half of 2022 (Figure 1). The creation of the solidarity lanes averted a full-blown collapse of Ukrainian agricultural exports. With EU support, these routes from Ukraine over land and rivers to Poland and other neighboring countries facilitated transport of grains and oilseeds. Starting in July 2022, a second arrangement, the Black Sea Grain Initiative brokered by Türkiye and the United Nations, allowed Ukrainian ships to transport food from Black Sea harbors along a humanitarian corridor without fear of attack. Both of these channels facilitated a recovery of cereal exports to around 4 million tons per month during July 2022-January 2023, though they remained well below pre-war levels in the post-harvest season (Figure 1).
Figure 1
From the outset, however, the solidarity lanes have created challenges—both for exporters in Ukraine and for neighboring countries. Existing rail, road and water infrastructure in Poland, Slovakia, Hungary, and Romania lacked sufficient capacity to absorb the new influx of Ukraine exports on top of normal export volumes from neighboring countries. As a result, the cost of transport through the solidarity lanes shot up, stranding shipments of grains, oilseeds and other food products from Ukraine at the borders of transit countries—where many ended up for sale on domestic markets.
Ukraine grain exports registered as imports to Poland, Hungary, Romania, Slovakia and other neighboring countries increased from virtually zero to around 12 million tons in 2022 (Figure 2)—meaning, of course, that amount was no longer reaching Ukraine’s traditional export destinations elsewhere in the world. A similar sea change in export orientation happened with sunflower seeds (Figure 3). This was fueled by dramatic growth in sunflower seed exports at the expense of sunflower oil—reflecting a loss of processing capacity within Ukraine and, hence, also of value added from processing (Figure 4).
Figure 2
Figure 3
Figure 4
Farmer protests and import bans
The diversion of Ukraine produce into the domestic food markets of Poland, Hungary, Romania, and Slovakia has driven prices down, hurting farm incomes in those countries, triggering the strong farmer protests. Farmer organizations have demanded temporary import bans and guarantees that products transiting through their territories will reach their intended destinations, and the unrest and political pressure has forced governments to respond.
Poland and Hungary announced temporary bans on grain imports from Ukraine on April 15. Slovakia joined them on April 17 and Bulgaria on April 19. Romania has also seen farmer protests and has absorbed the largest share of Ukraine exports through the solidarity lanes, but has so far stopped short of imposing an import ban. On April 20, Hungary expanded the list of banned Ukrainian products to 25 items, including meat, vegetables, oil, honey, rapeseed, and sunflower seeds. The measure will be in place until the end of June. Hungary is still allowing Ukrainian grain to transit through its territory, however.
While Ukraine has acknowledged the concerns of European farmers, authorities in Kyiv stress the importance of keeping the solidarity lanes open, saying that closing them would have significant adverse impacts on Ukraine farmers.
The EU response and global food security
The EU has criticized the moves of its member states to ban Ukrainian grain imports, as such “unilateral actions” are unacceptable and breach the EU trade policy. The governments of Hungary and Poland, in turn, have blamed the EU for allegedly being slow to address the income losses suffered by their farmers.
In late March, the EU offered a €56.3 million ($62.2 million) financial support package to compensate affected farmers in Bulgaria, Hungary and Poland, of which about €30 million ($33 million) would go to farmers in Poland. The Polish government said this was inadequate and announced it would be increasing its own support to farmers to 10 billion Polish zlotys ($2.4 billion), while moving to impose its import ban.
Subsequently, Ukraine and Poland reached an agreement to resume transit of Ukrainian agricultural products and drop import restrictions that took effect April 20. The agreement includes additional control measures, including the use of GPS seals to monitor transit, with the information being public and to be routinely communicated to market participants.
Meanwhile, by mid-April the European Commission announced it would allocate an additional €100 million ($110 million) in compensation to farmers in the affected five member state countries (Poland, Hungary, Romania, Bulgaria, and Slovakia). The governments of the affected EU countries will be allowed to double this amount through subsidies from their national budgets. In return, however, countries would need to drop import restrictions to obtain the EU support.
On April 20, the EU indicated it was working with the five affected member states on a more comprehensive response, including a second tranche of financial support for affected farmers, exceptional shipping safeguard measures on key products, and measures to facilitate the transit of Ukrainian grain exports via the solidarity lanes. As before, the proposed package will be conditional on the five countries lifting their unilateral bans on food imports from Ukraine.
Getting to an agreement soon on this more comprehensive package is of the utmost importance, not only to address the plight of the farmers in both Ukraine and the five EU countries, but also to ensure all surplus grain and vegetable oils reach, at affordable prices, food import-dependent countries in Africa, the Middle East, and other developing countries to satisfy their food security needs, which—after all—was the original objective of the solidarity lanes.
Rob Vos is Director of IFPRI's Markets, Trade, and Institutions Division (MTID); Joseph Glauber is an MTID Senior Research Fellow. Opinions are those of the authors.
