With both quotas and duties: how Ukrainian agricultural producers got used to the new trade rules in 2025
31 December 16:20
ANALYSIS FROM 
This year, Ukrainian agricultural producers have been confronting not only the challenges of nature, but also the experiments of officials. Komersant found out how successfully they coped with it.
Ukraine has completed the harvest in 2025. According to the Ministry of Economy, farmers harvested 57.6 million tons of grain and 17.3 million tons of oilseeds. The Ministry clarified that after the corn harvest is completed, the total grain production is expected to reach about 60 million tons. This is despite the full-scale war and difficult weather conditions.
Tested by nature and war
The southeastern regions of the country were particularly affected by drought this year. This impact was felt by farmers in Kherson, Mykolaiv, Odesa, Dnipro and Donetsk regions. Weather factors affected both early and late crops.
Says Oleksandr Buyukli, executive director of the First Ukrainian Agricultural Cooperative.
“The 2025 harvest was quite difficult for farmers. At first, weather challenges made it impossible to grow and then harvest the crops. For example, about 15% of corn is still in the field. It turns out that at first we had problems with harvesting, and now we have difficulties with exporting grain. The Russian shelling has led to a power outage at many port terminals, and this is slowing down export shipments,” the expert says.
He believes that one of the key tasks now is to ensure stable operation of ports and preserve maritime exports.
Denys Marchuk, deputy head of the All-Ukrainian Agrarian Council, also speaks about the existence of many problems in the frontline areas, such as destroyed livestock farms, mined fields, and a shortage of personnel. He also mentions the decision to provide budget subsidies for farmers from the frontline areas.
“It’s good that in the 26th year, support for the frontline areas is envisaged. But it is very important that state insurance for situations that arise in the frontline areas is put in place. As for what has already been achieved, I would like to mention the law on credit privileges for farmers that was adopted and finally signed,” the official said.
This is a law that exempts farmers from the frontline and occupied territories from paying loans, interest and lease payments during the war and for a year after it ends.
A test by the European Union
The Ukrainian Ministry of Economy did not deny itself the pleasure of comparing this year’s best Ukrainian performance with the European one. First of all, they point out that in terms of grain production, which is 57.6 million tons, Ukraine is already ranked second among the European Union countries, after France (63.1 million tons), ahead of Germany (45.2 million tons) and Poland (36.5 million tons), before the corn harvest is over. As for the corn harvest itself, Ukraine is the undisputed leader: in 2025, 23.5 million tons have already been harvested, while the total production of this crop in the EU is 57 million tons. Ukraine also holds the lead in sunflower – 9 million tons against 8.5 million tons in all EU countries combined.
However, not everyone in Europe likes competition with Ukrainian agricultural producers. This year, there was more than one reason to mention this. Bohdan Dukhnytskyi, Doctor of Economics, Leading Researcher at the Department of Agricultural Market and International Integration at the National Research Center “Institute of Agrarian Economics”, reminds that in 2025, the general terms of trade between Ukraine and the European Union changed three times.
As it is known, from the beginning of this year until June 5 inclusive, the regime of trade preferences with the option of quick corrective measures in the form of duties on seven commodity items – poultry, eggs, honey, sugar, corn, oats, cereals – was in force, if the volume of their imports from our country to the EU exceeds 5/12 of the average annual level calculated from July 1, 2021 to December 31, 2023. On June 6, 2025, a transitional period was introduced within the framework of the existing free trade zone between the parties, when a larger number of quotas were applied in accordance with the conditions relevant before the full-scale invasion of Ukraine by Russia. An important nuance here was their proportion at the level of 7/12 of the envisaged annual volume, i.e. until the end of 2025. In parallel, negotiations were underway on new terms of trade in agricultural products for a longer period. As a result, updated trade rules with the European Union came into force on October 29, 2025. Bohdan Dukhnytskyi continues.
“Out of the total list of 40 main and additional quotas for Ukraine, compared to 2021, four have been canceled completely, four have been redistributed, four more have remained unchanged, while most of the others have been significantly increased. The most notable increase in the allowed exports of domestic products concerns honey (+483%), sugar (+398%), barley cereals (+336%), processed starch (+300%), bran and residues (+286%), milk powder (+208%), eggs and albumin (+200%). On the other hand, quotas for imports of European pork, poultry and sugar to the Ukrainian market have increased,” the expert said.
According to him, in general, the current trade regime with the EU has set additional restrictions relative to the conditions of 2024, when trade preferences were still in effect. And where there are restrictions, there will usually be losses.
“If we take into account the actual exports of Ukraine for the entire last calendar year, the most significant losses will occur in the wheat segment – the high duty will lead to a decrease in exports by more than 80%, i.e. approximately within USD 1 billion. THE US WILL SUFFER THE MOST SIGNIFICANT LOSSES. Sugar exports are expected to decline by more than 60%. In value terms, this will amount to USD 117 million. THIS WILL AMOUNT TO 117 MILLION US DOLLARS. Most likely, as a result of the quantitative restrictions, revenues from exports to the EU of poultry, eggs, apple juice concentrate, and barley produced in Ukraine will also decrease. Some difficulties may be observed for honey exporters, although its sales to the EU regularly exceed the established quotas,” the expert notes.
Bohdan Dukhnytskyi, a leading researcher at the Institute of Agrarian Economics, compared the losses he listed with possible additional revenue due to the increased quotas and concluded that “Ukraine’s total agri-food exports to the European Union could decrease by USD 1.2-1.3 billion, or about 50% of the total. USD, or about 10% of the 2024 figure of almost USD 13 billion. THE US IS NOT THE ONLY ONE.
However, the expert emphasized that by reorienting part of the exports to the markets of other countries and regions, such as Asia and Africa, it is possible to compensate to some extent for the losses suffered by Ukrainian agricultural producers in the European market.
Testing the waters with government experiments
This year, Ukrainian officials experimented the most with soybean and rapeseed producers. This experiment had several stages. Two of them took place in the parliament, when, despite numerous critical statements by specialized agricultural associations, soybean and rapeseed amendments to the 10 percent duty on exports of these crops were “sneaked” into the “foreign” draft law. Another was outside the parliament, when government officials tried to supplement these amendments with a mechanism that would allow farmers who grow soybeans and rapeseed themselves to exercise the right to export duty-free. And this stage, it seems, cannot yet be considered complete, as many agricultural producers had to pay duties in order not to violate their export contracts. Denys Marchuk, Deputy Head of the All-Ukrainian Agrarian Council, continues.
“Many producers actually made a loss by paying this duty, because they had to fulfill their external contracts that had been signed earlier. That’s why it was such a shock therapy that took place throughout the sector. Then, a mechanism was developed to confirm the products they had grown themselves in order to avoid paying the duty. But many people who had to pay the duty have not yet been refunded. That is why we registered a draft law together with MPs so that in 2016 those who paid illegal duties would be refunded,” the expert said.
The statistics for September 2025, for example, can show who has already won as a result of this experiment. As reported by the Association Ukroliyaprom, after the introduction of the export duty on rapeseed, its processing increased to 250 thousand tons, which was the highest monthly figure in history.
This trend is also confirmed by Oleksandr Buyukli, Executive Director of the First Ukrainian Agricultural Cooperative.
“For processors, margins on soybeans and rapeseed have increased significantly. As for agricultural producers, unfortunately, they lost more than they gained. First, in September-October, rapeseed was “locked out” of the domestic market due to an incorrectly prescribed cargo clearance procedure. Secondly, there are still issues with the payment of duties by agricultural producers who export their own products. Many farmers are forced to pay the duty even when exporting. This means that they are freezing working capital that could have been used for their business. As for soybeans, processors are underpaying 10 percent on top of prices. Since exporters have reduced prices by the amount of duties, processing plants have lowered prices by the same 10 percent,” the expert explains.
According to him, the general conclusion is that the new procedure has worsened the situation for those who grow soybeans and rapeseed, while processors were able to increase their margins.
But the urge for controversial experiments is hard to stop. One of them concerns railroad transportation: as early as January, the relevant tariffs, including those for farmers, may be raised.
Author: Sergiy Vasilevich
