Ukraine poultry exports to the EU jeopardised
In 2018, Ukraine became the third-biggest poultry exporter to the European Union (EU). In total, the country supplied 123,000t of chicken to the EU, 53.7% up compared with the previous year, the European Commission has estimated. Ukraine is authorised to export 36,000t of various poultry products per year to the EU duty free, although there are no limits for duty free exports of in-bone chicken breasts.
A European Commission spokesperson told the newspaper Politico that it had reached a new agreement with Ukraine on poultry, which would now be sent to the Council of the EU and the European Parliament for approval.
The main point of the agreement was that the duty-free quota on boneless chicken breasts could be raised from the current 20,000t to nearly 70,000t. In exchange, Ukraine had to stop using what was described as “a loophole”, as Ukraine poultry giant MHP has been exporting in-bone chicken breasts duty free to its European processing facilities, where the bone was sliced out, so the company could obtain product with a higher added value.
MHP has purchased several processing companies in Europe, including Slovenian company Perutnina Ptuj in February 2019.
In 2018, Peter Vesseur, general secretary of the Dutch Poultry Processing Association, and Lukasz Dominiak, director general of Poland’s National Poultry Council, raised concerns that, by using this loophole, Ukraine poultry farmers managed to bypass EU import restrictions and pay less import duty than they should.
Speaking during a meeting in Brussels on 18 March, Polish agriculture minister Jan Krzysztof Ardanowski stressed that poultry imports from Ukraine created an imbalance on the domestic poultry market in Poland and that the Polish farmers were negatively affected.
During a follow-up press-conference, European commissioner for agriculture Phil Hogan said some restrictions were planned in relation to Ukraine poultry exports to the EU, “in a view from the pressure from Poland”, although he provided no additional details.
Ukraine's Agriculture and Food Ministry has not provided any comments about the planned new agreement with the EU on chicken exports to GlobalMeatNews.
A source in the Ukraine government, who wished to not be named, confirmed there were negotiations on this subject, but denied that any agreement had already been reached.
“Ukraine poultry companies have been only using the terms of the Deep and Comprehensive Free Trade Areas and there was no cheating from our side,” the source said. “We would not agree to any terms that could put Ukraine poultry companies at a disadvantage, while any unilateral decisions by the EU could contradict to the spirit of free trade.”
In general, it is believed that Ukraine poultry exports to the EU could be negatively impacted by the decision to subject in-bone chicken breasts to some import duties, even if the duty-free import quotas on boneless chicken breasts were expanded in exchange.
