Ukraine Shifts Strategy as EU Trade Arrangements Near End

Ukraine plans to adjust its agricultural export policy as free access to the EU market nears its end. With EU duties on Ukrainian goods set to resume, Ukraine aims to boost domestic food processing and renegotiate quotas to cushion the expected revenue shortfall.

Ukraine is preparing to overhaul its agricultural export strategy in anticipation of the end of its duty-free access to the European Union market. The shift aims to cut the export of raw materials and enhance domestic food processing capabilities, according to the country's farm minister.

Last year, agricultural goods made up about 60% of Ukraine's $41.6 billion in total exports, with the EU accounting for around 60% of that market. The EU suspended tariffs and quotas following Russia's 2022 invasion, but this arrangement will expire on June 5, leading to a renegotiation phase where quotas will replace the current free trade.

Ukrainian officials are concerned this could cause an annual revenue loss of up to 3.5 billion euros. To mitigate such a deficit, Ukraine is focusing on maximizing the use of its oilseed processing capacities and seeking better trade terms with the EU than those in place prior to the conflict.

(With inputs from agencies.)