Ukrainian market – a new opportunity for Polish export?

| Foreign Markets |

The first four months of 2014 brought an interesting tendency, with 22.4% less Polish goods exported from Poland to Ukraine than in the same period of 2013. Total value of exported foodstuffs was 937.73 million USD. At the same time, imports from Ukraine rose by 18.5% and reached 1008.39 million USD.

The commercial part of the EU Association Agreement with Ukraine has been regarded by some as a threat to our country. However, some segments of the agricultural market have benefited from the closer cooperation with Kiev and improved their foreign trade exchange balance.

Leveraging our potential

Experts believe that the situation is likely to benefit the manufacturers of farming vehicles and equipment, and other means of assisting agricultural production, as well as dealers who sell such products. They have seen exports to Ukraine rising already, and this trend might become even more visible.

In Q1 of 2014 the exports of mineral and chemical fertilizers grew by as much as 80%, reaching the value of 5 million USD and the volume of 6068 tonnes. Polish manufacturers are clearly interested in selling to East Central-European countries. Our producers are able to offer products at a better price than their counterparts from Western Europe.

Not everybody benefits

Polish exporters of cereals are less enthusiastic about the opening of the European market to the Ukrainian agricultural products. Previously, our dealers had seen the exports of Polish cereals rise. They feared that the development and modernization of agricultural production was Ukraine is going to increase the supply of Ukrainian cereals, which are cheaper, on the European market.

Specialists agree that such markets as Africa and Middle East (for example, Saudi Arabia, Morocco, Egypt) would buy Polish cereals gladly. They also remark that the unilateral lifting of duties by the EU has not opened up the Common European Market to Ukraine completely. In the case of agricultural products, 82% of duties were lifted. However, duty-free importation quotas concern such products as cereals, beef, pork, and poultry. This means that the EU manufacturers enjoy some protection of their interest. The EU may restore duties if the influx of Ukrainian products destabilizes the market and makes business activity difficult for EU producers.