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Tension Between Ukraine and Ally Poland Over Grain Exports Vexes EU

Stock MarketsTension Between Ukraine and Ally Poland Over Grain Exports Vexes EU

EU authorities must decide Friday whether to extend a ban preventing Ukrainian grain from being sold in neighboring EU countries, an issue that has sparked a rift between Kyiv and Poland, one of the Ukrainian government’s strongest backers in the war. The temporary ban, aimed at keeping out cheaper exports, expires at midnight Friday.

The decision is the first of several coming tests of European support for Ukraine, at a time when questions are rising about Washington’s commitment to Kyiv ahead of next year’s presidential election.

Poland is holding parliamentary elections next month, with the nationalist government facing a tight race in which it hopes to rally rural voters for support.

Elections in Slovakia at the end of this month could return to government Robert Fico, polls show. He has campaigned against Western sanctions on Russia.

The EU’s 27 member states must decide by year-end on a proposed economic aid package of roughly $53 billion for Ukraine and a military assistance proposal of roughly $21 billion.

Tensions over the grain issue have increased ahead of Friday’s deadline for the EU to decide whether to extend the current arrangements, which permit Ukrainian grain exports to enter Poland, Hungary, Slovakia, Romania and Bulgaria only to transit to other markets.

Poland has threatened to break EU rules and act unilaterally to ban Ukrainian grain if the EU doesn’t extend the current arrangement until year-end. Kyiv has warned it will take the bloc to the World Trade Organization to seek compensation if the ban isn’t lifted.

“Ukraine expects the European Commission to keep its word and lift all restrictions on Ukrainian agricultural exports tomorrow,” Dmytro Kuleba, Ukraine’s foreign minister, said on social-media platform X, formerly known as Twitter.

Grain exports are a critical part of Ukraine’s economy, which was the world’s second-largest grain exporter in 2021, before Russia’s large-scale invasion. That year, Ukraine exported around $27 billion in agricultural products, making up about half of its total export income.

When Russia blockaded Ukrainian ports after its invasion, it threatened not only to deprive Ukraine of a significant portion of its revenue but also created worldwide fears of food shortages that sent global grain prices rocketing.

Ukraine pivoted by sending more grain over land to Poland and by ship through Romania, but the ensuing discord between the two countries has reawakened historic tensions between Poland and Ukraine, which forged a tight partnership in the first months of the war against Russia, a shared foe.

The grain issue has also divided the bloc. Most member states oppose extending the current arrangement, diplomats say. On Thursday, Bulgaria’s government said it was dropping its import ban.

“I want to say it clearly—we cannot agree to the sudden and uncontrolled import of this grain leading to instability and destabilization of the Polish market,” Polish Prime Minister Mateusz Morawiecki said on X this week.

The Dlugolecki family, who have been working for generations on their 60-hectare farm in the village of Milewo-Kulki north of Warsaw, said the influx of Ukrainian grain has depressed prices so deeply that they have sold none of their harvest from last year and don’t intend to sell any this year unless prices rise.

While the wheat from Ukraine is meant to only transit Poland on its way to Asian and African customers, some is still sold on the black market at a cheaper price in the country, while the rest has clogged its ports and storage facilities.

Danuta Dlugolecka, 57, said that until prices rise, she plans to store the harvest in her 200-ton facilities and live off savings and the money the farm makes from chickens.

“Those who are not as fortunate sell some of their harvest, but most people hold on to it, waiting for the right price,” she said.

In July, Ukrainian Prime Minister Denys Shmyhal criticized Poland for “unfriendly and populist” actions over the grain ban. That caused a furor in the Polish government, which welcomed millions of Ukrainians in the early weeks of the war. A Polish presidential adviser said in July that Ukraine should be more grateful for all Poland had done.

While support for Ukraine generally runs strong across Poland’s political landscape, the relationship is complicated.

Poland has long sought a Ukrainian apology for the massacre of Poles by Ukrainian nationalists between 1943 and 1945 in the Volhynia and eastern Galician regions of what is now Ukraine. Historians believe up to 100,000 Poles died.

In July, Polish President Andrzej Duda and Ukrainian President Volodymyr Zelensky, seeking to calm historic tensions, jointly commemorated at a Catholic church in western Ukraine those Poles killed during the war.

The grain spat has set back goodwill efforts.

So far, European support for Ukraine has remained solid despite a string of EU elections since the war began. In addition to Slovakia and Poland, Dutch voters go to the polls in November and European Parliament elections follow next June.

To maintain cohesion, EU officials have doled out hundreds of millions of euros to Polish and other farmers, but Brussels’ funding for more assistance is drying up.

Nor is the problem shrinking. In August, in the aftermath of Russia’s decision to kill the United Nations-brokered Black Sea Grain Initiative, Ukraine exported four million tons of grain via the EU, the second-highest amount since the EU launched a so-called Solidarity Lane arrangement to smooth Ukraine’s exports in May 2022.

With the onset of the harvest season, pressure on grain storage and transport facilities in Poland and Ukraine’s other EU neighbors is likely to intensify.

Last month, truckers on the border between Ukraine and Poland said grain shipments were taking days to process amid problems on both sides of the border.

“Grain trucks are standing for days at a time, the line is huge,” said Ihor Vorvan, 33, a Ukrainian truck driver, entering Poland. “They’re just not getting across.”

Write to Thomas Grove at tho[email protected] and Laurence Norman at [email protected]

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Tension Between Ukraine and Ally Poland Over Grain Exports Vexes EU
Tension Between Ukraine and Ally Poland Over Grain Exports Vexes EU

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Tension Between Ukraine and Ally Poland Over Grain Exports Vexes EU

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