E.U. set to end tariff-free regime for Ukrainian products in early June — Financial Times

The E.U. is getting ready to end tariff-free access for Ukrainian goods in the coming weeks, the Financial Times reported on Wednesday, citing diplomatic sources.

The preferential trade regime, introduced after Russia’s full-scale invasion of Ukraine in 2022, supplemented the existing E.U.-Ukraine free trade agreement and allowed most Ukrainian goods to enter the bloc without tariffs. That arrangement is set to expire in three weeks, on June 6.

The move to phase out these measures follows pressure from Poland, which raised concerns about the impact on its farmers.

To ease the transition, the E.U. plans to introduce temporary measures while negotiations continue on a revised trade agreement. According to diplomats cited by the FT, the proposal would sharply reduce the tariff-free quotas of agricultural products and divide the annual tariff-free quota into 12 monthly ones.

The proposed cuts would most affect corn, sugar, honey, and poultry. The duty-free quota for corn, for example, would drop from 4.7 million metric tons to 650,000; for poultry, from 57,100 to 40,000; and for sugar, from 109,000 to 40,700 metric tons.

A European Commission spokesperson confirmed that the current preferential access for Ukrainian agricultural products will not be extended, noting that both sides are working to revise the broader E.U.-Ukraine trade agreement. The spokesperson also said contingency measures are being prepared in case talks are not finished by June 6.

“It’s a really bad signal to Ukraine. It will take at least until October to find a solution,” Bernd Lange, the head of the European Parliament’s trade committee, told the FT.

Ukraine’s government estimates that reverting to prewar trade conditions could cost the country up to 3.5 billion euros ($3.9 billion) in annual revenue.