Ukraine asks the EU for 220 million euros for farmers affected by export blockages

Ukraine has requested approximately 220 million euros from the European Union to support farmers affected by the disruption of agricultural exports through the Black Sea, and the European Commission confirms that the request is under evaluation. Kyiv proposes that the funds be used to reduce interest rates on bank loans granted to farmers, so that they can continue their activities. Brussels has not yet set a deadline for a decision and says that the response will also depend on the evolution of the harvest, storage capacity, and the functioning of export routes.

In short

Kyiv has requested approximately 220 million euros to subsidize interest rates on bank loans granted to Ukrainian farmers.

The Commission says it needs to evaluate the evolution of the harvest, the available storage capacity, and export possibilities before deciding on the next steps.

Brussels is monitoring the routes in the Black Sea and the effects of Russian bombings on Ukrainian agricultural exports.

The Commission is also discussing with Romania, Moldova, and companies involved in transport about alternative routes through solidarity corridors.

The Commission has not announced when the evaluation will be completed and has not confirmed that the requested grant will be awarded.

The request sent by the Ukrainian authorities stipulates that the grant of approximately 220 million euros should be used to reduce the cost of financing for farmers. According to explanations provided by the Commission, the support would subsidize the interest rates applied to bank loans, which would allow financial institutions to continue lending to the agricultural sector and producers to maintain their operations during a period when exports are affected by war. "Ukraine explained actually to us in their request how this grant could be used, and it would be used to subsidize the interest rate of banks for lending to farmers, and so they could maintain their operations with farmers," said a spokesperson for the Commission.

Brussels has not yet made a decision on granting the funds and does not treat the request solely as a financing issue. The Commission says it needs to evaluate in parallel the quantity of products that will enter the market after harvesting, the available storage space, and Ukraine's capacity to continue exports. These elements are interconnected, as blocking or slowing down transport can leave larger quantities of agricultural products in the country and increase pressure on farmers and storage infrastructures.

"We need to see how the Ukrainian harvest progresses in the coming months. Second, we need to see how this aligns with storage availability, and third, we need a clear overview of export logistics, including Black Sea routes and current functionality of the solidarity lanes," explained a representative of the Commission. Brussels says it needs this picture before establishing what additional interventions are necessary and how support should be configured. Consequently, the request for 220 million euros should not be presented as approved funding, and the final amount and the instrument through which it could be granted have not yet been established.

The situation in the Black Sea represents one of the central components of the assessment. The Commission is monitoring the effects of Russian bombings and transport disruptions on Ukrainian agriculture and economy and says it maintains permanent contacts with the authorities in Kyiv. Brussels specified that the Ukrainian Minister of Agriculture recently had discussions with EU representatives, and the analysis continues as new information about the harvest and exports emerges.

In parallel, the Commission is discussing with Romania, Moldova, and companies involved in transport to assess the functioning of alternative routes through solidarity corridors. These were developed after the large-scale Russian invasion to allow the transport of Ukrainian goods through railway, road, and port networks when access through the Black Sea is limited. However, Brussels has not announced in the briefing a concrete extension of the corridors or an immediate increase in quotas for Ukrainian agricultural products.

When asked whether such decisions could be made in the coming weeks, the spokesperson avoided providing a timeline. "I can't tell you a specific timeline yet, but indeed we still need to analyze, and then we will come up with the concrete solutions," he said. The Commission thus links any new intervention to data regarding the harvest, storage, and export logistics and has not indicated that the evaluation will be completed before the end of the agricultural season.

Brussels has reaffirmed that maintaining Ukraine's capacity to export agri-food products is important both for the Ukrainian economy and for global food security. The Commission believes that the revised trade regime between the EU and Ukraine continues to provide a stable and reciprocal framework and stated that the data available so far indicates a balanced nature of the agreement. However, detailed figures regarding the effects on certain products or on farmers from member states were not presented in the briefing.

The request for 220 million euros therefore represents one of the support options under analysis by the Commission and not a final decision. The European executive has not said whether the amount could be granted in full, reduced, or combined with other measures, nor from which financial instrument the funds would come. The next step depends on the assessment of the agricultural and logistical situation and the continuation of discussions with the Ukrainian authorities and with the states involved in the alternative transport of goods.

The European Union created solidarity corridors in 2022 to maintain Ukraine's exports and imports after the blocking or disruption of traditional maritime routes. These use infrastructure from member states and Moldova and operate in parallel with the routes available through the Black Sea.

The Commission says that the evolution of the harvest, storage capacity, and the functioning of all these routes will be analyzed together before new decisions are made. The request for approximately 220 million euros remains under evaluation, without a deadline announced for a response.

https://2eu.brussels/ro/news/ucraina-cere-ue-220-de-milioane-de-euro-pentru-fermierii-afectati-de-blocajele-exporturilor