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Farmers await decision on grain subsidies. Protests from recent weeks may soon spread across the country

FOOD & AGRICULTUREFarmers await decision on grain subsidies. Protests from recent weeks may soon spread across the country

“Farmers are protesting for a just cause and the government should sit down with them as soon as possible to prevent these protests from spreading across all of Poland, causing traffic disruptions and everyday hindrances, because the patience of Poles is also limited,” says Monika Piątkowska, Chairwoman of the Grain and Feed Chamber. For several weeks now, farmers have been demonstrating, blocking roads, and protesting against the implementation of the European Green Deal and the influx of goods from Ukraine. Their situation is presently worsened by the difficult situation in the domestic grain market and low raw material prices. Therefore, agricultural chambers are calling on the government to launch subsidies as quickly as possible.

The domestic grain market is currently struggling with significant difficulties. Grain prices remain under strong downward pressure, resulting from global market prices and moderate demand from processors, who are reducing purchases and currently relying on previously concluded contracts. As a result, farmers – especially larger farms – are reluctant to sell grain at the current, low prices.

“The grain supply in the Polish market continues to be limited. Farmers are holding back on selling this grain because the prices are unsatisfactory. The government has announced subsidies and I know that the Minister of Agriculture has made such a request to the Minister of Finance – which also causes farmers to wait with the sale of grain for the decision on whether there will be a subsidy system,” says Monika Piątkowska.

Limited supply especially affects barley and oats, and analysts expect the situation to improve probably only around spring.

“This limited grain supply has been ongoing for some time and results from low prices on the world exchanges, which also cause low prices in Poland. It is said that wheat prices on the farm of about 500–600 PLN or even at the port at the level of 900 PLN per ton are not values that satisfy Polish farmers today,” emphasizes the Chairwoman of the Grain and Feed Chamber.

As she points out, despite the limited supply of grain in Poland, there is no shortage, because farmers still have unsold stocks from the previous season, which are also higher than the average stocks from previous years. The Grain and Feed Chamber estimates that this surplus is about 4 to 6 million tons.

“It is difficult to indicate a precise value, as agricultural reporting does not apply in our country. And this is one of our demands: for the Ministry of Agriculture to resolve the issue of market monitoring, reporting on grain quantity, and storage area. We should propose a system that allows us to precisely monitor the market, because precise data are necessary in crisis situations. And we are dealing with another difficult situation, to say the least,” says Monika Piątkowska.

In mid-February, the National Council of Agricultural Chambers – due to the difficult situation and lack of stabilization in the domestic grain market – appealed to Prime Minister Donald Tusk, the Minister of Agriculture and Rural Development, and the Minister of Finance with a request for an immediate launch of grain subsidies (as well as corn, milk, pigs, fertilizers, and fuel), on terms and rates similar to the aid granted to farmers last year.

Since the beginning of February, demonstrations, roadblocks, and farmer protests have been taking place all over Poland, according to which agricultural production has become unprofitable. The protesters primarily oppose the introduction of the European Green Deal and the influx of goods from Ukraine, which reduce the competitiveness of Polish agricultural production. On February 20, farmers announced a general protest and a “march on Warsaw” and the blocking of border crossings between Poland and Ukraine. On Sunday, there was information in the media that the date would be postponed to February 27.

“The government should first and foremost sit down at the table with the farmers who are protesting – I want to say this very clearly – for a just cause, because the provisions of the European Green Deal will reduce the competitiveness not only of Polish but also of European agriculture. This is understood by Polish and European farmers, as we can see, these protests are taking place not only in Poland but in many European countries,” emphasizes the Chairwoman of the Chamber. “The second element, important for farmers, is the regulation of trade relations between Poland and Ukraine, in order to neutralize the threat of uncontrolled influx of Ukrainian agri-food products to our market. In this matter, bilateral talks are already taking place between Poland and Ukraine, in order to work out an agreement introducing, for example, limits on grain imports from Ukraine. Working out such an agreement should be an absolute priority for the Polish government today. ”

The conflict over Ukrainian grain escalated last autumn when the European Commission did not extend the embargo on its export to five EU countries – Romania, Bulgaria, Slovakia, Hungary, and Poland, which extended this ban on its own initiative and decided to maintain the blockade. This provoked a strong reaction from Ukraine, which filed a complaint against Poland to the World Trade Organization. The grain dispute has caused Polish-Ukrainian relations to be tense, and the dispute has not yet been resolved. According to domestic farmers, Poland – which was supposed to be just a transit corridor for Ukrainian exports – turned out to be unprepared for this, which is why grain from Ukraine is still reaching the domestic market.

“Transit, which goes through Poland, or should go, is quantitatively quite limited. This may pose some risks in the future, if we clear the space in the international markets, even in the European Union markets, Russian grain may enter these markets. We know that there are the first signals of this, that the Russians are increasing exports. This is probably not a good practice today,” Monika Piątkowska notes. “In my opinion, transit should go, but it should be very precisely monitored, so that there is no threat that this grain will stay in Poland. We should, on the one hand, help Ukraine, on the other hand, not leave the field open to Russian wheat or other types of grain.”

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