Following its announcement to EU leaders on Thursday 21 March (see EUROPE 13376/4), the European Commission proposed to increase tariffs on grain, oilseeds and derived products from Russia and Belarus on Friday 22 March. The leaders showed clear support for this proposal at their summit on 21 and 22 March, according to a European source. This proposal for a Council regulation will require a qualified majority among member countries, unlike sanctions, which are adopted unanimously.
“We are very pleased that the Commission has proposed putting tariffs on Russian grain, so that our competitiveness in Europe is not affected and we further penalise Russia financially and economically”, Latvian Prime Minister Evika Siliņa told the European summit on 21 and 22 March. His country had already banned imports of agricultural products from Russia and Belarus until 1 July 2025.
For German Chancellor Olaf Scholz, “this is a necessary and fair decision”.
These products can currently enter the European market with low or zero tariffs, under World Trade Organization (WTO) tariff rules. The new duty will be €95 per tonne, or 50% of the price, depending on the product. The EU hopes this will put an end to these imports.
The impact on the European market is unlikely to be significant given current import volumes. The EU imported 4.2 million tonnes of the products in question from Russia in 2023, around 5% of its total imports of grain and oilseeds. From Belarus, volumes are even lower. What’s more, total imports of these products represent only a small proportion of EU consumption, due to the high level of domestic production.
However, the EU fears a significant redirection of Russian exports of these products to the European market. Moscow is a major producer on the world stage and import volumes already increased in 2023 compared with previous years.
“We don’t want Russia to have any revenues from the EU agri-food market”, said the President of the European Commission, Ursula von der Leyen, after her meeting with the 27 European leaders.
The aim is also to prevent goods produced in the occupied Ukrainian territories from being exported to the EU once they have passed through Russia.
“The tariffs we are proposing will make imports of these products economically unviable”, according to the European Commissioner for Trade, Valdis Dombrovskis.
Kremlin spokesman Dmitri Peskov denounced the Commission’s announcement of higher taxes on grain. He says that European consumers will suffer as a result of this measure.
Autonomous trade measures for Ukraine
The extension of the suspension of tariffs on Ukrainian products was also discussed at the European summit. The leaders insisted that this extension should be the last and that the suspension of tariffs should only run until June 2025. In their conclusions, the heads of state or government call on the EU Council to find a solution “in the framework of the EU-Ukraine Association Agreement and Deep and Comprehensive Free Trade Area (DCFTA)”.
The Permanent Representatives of the Member States to the EU (Coreper) must rapidly revisit the provisional agreement reached with the European Parliament (see EUROPE 13375/9) with a view to approving it unchanged.
During the summit, French President Emmanuel Macron expressed his desire to add wheat and barley to the list of products covered by an automatic safeguard. He would also like to change the reference period for the import volumes taken into account to activate this backup. He called for the provisional agreement to be reopened, but according to a European diplomat, a majority of the EU27 is in favour of adopting the provisional agreement without changes.
See the draft regulation: https://aeur.eu/f/bh3
See the European Council conclusions: https://aeur.eu/f/bhb (Original version in French by Léa Marchal with the editorial staff)