The global context

Russia’s invasion of Ukraine in February 2022 led to an obstruction of global trade routes as approximately 20 million tonnes of grain were trapped in Ukrainian ports. Given Ukraine’s critical role as a global supplier of agricultural products, global food prices climbed sharply.

To mitigate the effects of Russia’s blockages on Ukrainian grain, the European Commission (EC) launched the Solidarity Lanes Action Plan in May 2022 in order to establish alternative logistics routes. Following this action plan, the Black Sea Grain Initiative was launched on July 22, 2022 – a UN-brokered deal between Ukraine, Turkey and Russia that enabled the former to resume shipments of millions of tons of grain exports through the Black Sea. Romania and Bulgaria were the only countries in Southeast Europe (SEE) to have been cargo destinations of outbound voyages from Ukraine. By May 15, 2023, Romania had been the destination for 285,096 metric tonnes of cargo transiting through the Black Sea Grain Initiative, while Bulgarian ports took in 68,836 tonnes, according to data from the United Nation’s Black Sea Grain Initiative Coordination Centre’s website. Globally, food prices, including cereals, eased as a result of the newly established trade routes.

The reverse effect

Following the Black Sea Grain Initiative and the establishment of solidarity lanes, the inflow of cereals into the market of SEE has skyrocketed. Ukrainian cereal imports to SEE have been historically concentrated in Romania and Bulgaria, but other states in the region have seen an exponential upswing following Russia’s invasion of Ukraine. 

In 2019, Romania’s cereal imports from Ukraine amounted to 7,156.8 tonnes, while 2020 saw a 163% jump, only for these to drop by an annual 91% to 1,636 tonnes in 2021, UN Comtrade data shows. By the end of 2022, Romania’s cereal imports from Ukraine grew almost fifty times

on the year, to 1.3 million tonnes. Ukranian cereal imports into Bulgaria sat at 6,086.5 tonnes in 2019, plummeting by 76% in 2020, before jumping 242% to 4,905.1 tonnes in 2021 and rising over nine times to 45,255.9 tonnes in 2022. Croatia has been a more modest recipient of Ukrainian cereals in the three years prior to the war, with no imports recorded in 2019, followed by a 22-tonne inflow in 2020 and a nine-fold jump to 197.7 tonnes in 2021. In 2022, the country’s cereal imports from Ukraine soared over 200 times to 42,696 tonnes. Similarly to Croatia, Slovenia imported no Ukrainian cereals in 2019, while in 2020 and 2021, it took in 10.3 tonnes and 38.6 tonnes, respectively. In 2022 Slovenia’s cereal imports from Ukraine saw a 74-fold increase to 2,861.4 tonnes. Serbia’s imports of Ukraninan cereals sat at 66.8 tonnes in

2019, only to decrease by 66% on the year in 2020 and grow sixteen-fold to 362.2 tonnes in 2021, before a significantly more modest annual increase of 5% to 379.9 tonnes in 2022.

Pressure on prices?

A year prior to the war in Ukraine, the prices charged by domestic producers in SEE for their output of cereals had already risen substantially across the four major economies in SEE, with Slovenia topping the list after a 42.46% annual increase, followed by Croatia, Bulgaria and Romania, which recorded annual increases of 35.7%, 22.56% and 17.18%, respectively. 

The year 2022, marked by Russia’s invasion of Ukraine, brought the largest annual hikes over the most recent four-year horizon, with Slovenia registering the highest annual increase for a second consecutive year, of 41.57%. Croatia, Bulgaria and Romania followed with annual jumps of 40.57%, 32.9% and 32.15%, respectively. Despite still growing on an annual basis, producer prices for cereals saw a considerable easing of inflationary pressures across the four countries in the fourth quarter of 2022. Farmers across SEE have voiced their dissatisfaction with the high influx of Ukrainian grain, protesting logistical jams and the undercutting of the prices of domestic crops.

The EU’s intervention

In an effort to mitigate logistical bottlenecks and curb glut on local markets, the European Commission (EC) halted imports of Ukrainian wheat, maize, rapeseed and sunflower seed into Bulgaria, Hungary, Poland, Romania and Slovakia from May 2, 2023 until June 5, 2023, while the remaining EU member states can continue to import them. The products will continue to transit the five states to reach other EU markets, or countries outside the bloc, under a common customs transit procedure, the EC said in a press release on May 2. Following the limited suspension of imports, the Commission also made available a EUR 100 mln support package to cereals and oilseeds farmers in the five member states, with Romania and Bulgaria being the recipients of EUR 29.73 mln and EUR 9.77 mln, respectively. The five countries can complement the EU support in amounts of up to 200% of the grant, which would bring the overall financial aid for affected farmers to EUR 300 mln. The EC had previously adopted a support measure worth EUR 56.3 mln to mitigate the effect of excessive imports from Ukraine on farmers in Poland, Bulgaria and Romania.

This analysis is part of our upcoming report on the agriculture sector in SEE’s hottest crop markets: Bulgaria, Romania, Serbia and Moldova. Subscribe now to be among the first to get the report in June and read more about the effects of Ukrainian grain imports into the region, get insights about the four markets’ yields and further potential as crop producers and more.

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