In an exclusive commentary to Komersant ukrainskyi
, economic expert Andriy Novak shared his forecast for sugar prices in Ukraine. According to him, there is currently a downward trend in the cost of this product. However, everything depends not only on the situation on the domestic market.
“So far, we see a downward trend in sugar prices. Then everything depends on the EU sugar quotas for Ukraine. If there are no quotas, there will be more sugar on the domestic market and the price will not rise,”
– novak explained.
Thus, sugar prices will be stable until the end of the year, and then the situation may change:
“Quotas are formed by the end of the year for the next year. Therefore, by the end of the year, prices will be in the same range as now. And then everything will depend on whether Ukraine gets quotas or not.”
As reported
However, in 2025, the quotas will be even lower – by about 2.5 times. The quotas for duty-free imports of Ukrainian sugar to the EU in 2025 will amount to 109,438.62 tonnes. Anything imported over this amount will be subject to duty. This practice is called the “Deep and Comprehensive Free Trade Area” in the EU.
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The preferential trade regime and its enemies
The decision to allow the free import of Ukrainian goods into the EU was made by the EU at the beginning of the full-scale Russian invasion as a gesture of support for the Ukrainian economy and in response to the Russian naval blockade of Ukrainian ports. During the two years of its operation, the simplified regime has gained a lot of opponents in the EU. In particular, the governments of Bulgaria, Poland, Hungary, Romania and Slovakia demanded that imports of Ukrainian products be restricted (later France joined this position). They claim that cheap agricultural products from Ukraine are swallowing up their markets.
Six major European farmers’ associations also protested strongly against Ukrainian products. Polish farmers have even staged a border blockade, not only with Ukraine but also with Germany.
Nevertheless, after a tough debate, the simplified trade regime with Ukraine was extended until 5 June 2025. However, at the request of these countries, it was severely restricted.
Thus, the provisions on duty-free trade were amended to include further “safeguards” to protect European producers.
In particular, the European Commission may take any measures it deems necessary if imports from Ukraine cause “significant disturbances” on the EU market or the markets of one or more EU Member States. In such a case, the European Commission may launch an “emergency brake” for particularly sensitive agricultural products. This list includes the following products:
- poultry
- eggs
- sugar
- oats
- cereals
- corn;
- honey.
However, the European Commission has not only options but also responsibilities. If imports of these goods exceed the average import volumes recorded in the second half of 2021 and for the whole of 2022 and 2023, customs tariffs must be restored within 14 days.
Thus, the EU has effectively reintroduced quotas on imports of many Ukrainian goods, albeit at a rather high level.
The EU’s customs and quota policy on Ukrainian goods has a direct impact on prices in the Ukrainian market. It also determines how much Ukrainian goods will remain in Ukraine. Roughly speaking, without taking into account other factors, the stricter the EU’s customs policy towards a particular Ukrainian product, the lower its prices in Ukraine.