New EU tariff quotas will reduce Ukrainian exports by $1.1 billion annually — IER

Wheat exports will suffer the most, and exports of sugar, barley, poultry meat, eggs, honey and apple juice are also expected to fall.

The introduction of updated tariff quotas by the European Union will lead to a decrease in Ukrainian exports to the EU by $1.14 billion per year compared to 2024. This is reported by APK-Inform with reference to IED.

According to analysts, wheat exports will suffer the most – losses will amount to about $894 million annually, or 80% of the total reduction.

Despite this, researchers emphasize that the new quotas are still a step towards trade liberalization compared to the regime that was in force until 2022.

“Four tariff quotas have been completely abolished, another 26 have been expanded. Most of all – for honey, sugar, barley groats and bran. This opens up the potential for duty-free exports of $630 million per year and could save Ukrainian exporters up to $165 million in duties,” the study authors note.

The IER emphasizes that the lost trade volumes with the EU can be partially compensated by reorienting supplies to other markets. According to forecasts, about $891 million of exports will be redirected outside the European Union, so Ukraine’s total losses will amount to about $253 million, or only 0.6% of the export volume in 2024.

The main reasons for the decline remain the increase in logistical costs for wheat supplies to further destinations and lower prices in alternative markets for certain categories of goods.

Thus, despite partial compensation due to new markets, the updated EU tariff quotas will become a noticeable challenge for Ukrainian agricultural exports, primarily the grain segment.

Recently, Deputy Prime Minister for European and Euro-Atlantic Integration of Ukraine, Taras Kachka, stated that the new EU quotas meet the ambitions of Ukrainian exports.