European Commission proposes tariff increase on Russian grains

The European Commission (EC) on Friday March 22 proposed an increase in tariffs on imports of cereals, oilseeds and grain products into the EU from Russia and Belarus.

Depending on the product, the tariffs will increase to either €95 ($102.66) per tonne or to an ad valorem duty of 50%. 

In addition, Russia and Belarus will no longer have access to any of the EU's WTO quotas on grain that offer better tariff treatment for some products.

“We propose the imposition of tariffs on these Russian imports to mitigate the growing risk to our markets and our farmers,” EC president Ursula Von der Leyen said.

Among the EC's stated objectives is the prevention of EU market destabilization, which farmers across EU countries have protested since the start of the year.

The tariffs are also aimed at preventing the export of illegally appropriated grain produced in Ukrainian territories from being profitably sold into the EU. 

While the tariffs would impact the sale of Russian grains into EU markets, the proposal would continue to allow Russian grains' unhindered transit through the EU, storage in EU customs warehouses, transportation on EU vessels, and the provision of insurance and financing services for the trading of Russian grain.

Russia exported 4.2 million tonnes of cereals, oilseeds and derived products — worth €1.3 billion — to the EU in 2023, according to the EC.

Further data from the EC shows that Russia is the second-largest supplier of sunflower meal to the EU this marketing year after Ukraine, while Russia's share in total supply of sunflower meal to the EU varies at 21.50-38.00%.

The proposed introduction of an import duty of 50% on oilseeds and their processed products may lead to a change in trade flows for Black Sea-origin sunflower and rapeseed meals, according to market sources, due to the large quantities these countries export to the EU.

In the 2022-2023 marketing year, imports of Russian wheat into the EU totaled 363,486 tonnes, less than 1% of total imports. From July 2023 to January 2024, Russian wheat supply increased to 710,834 tonnes, or 3% of the total, according to available customs data.

For a large part of the 2023-2024 marketing year, wheat imports from Russia were durum, accounting for 424,504 tonnes (13%) of the 3.2 million tonnes imported in total.

At the same time, the share of EU destinations for Russian wheat exports was just 2% for July 2023 to January 2024.

EU corn imports from Russia were even less significant, with just 388,754 tonnes imported in the 2022-2023 marketing year — less than 1% of the 202,401 tonnes imported so far in the 2023-2024 marketing year.

Finally, barley supply from Russia was minimal, with only 10 tonnes imported by the EU in the 2022-2023 marketing year and 54,707 tonnes in 2023-2024 — both well below 1%.

Around 5-6% of Russian corn and 1% of Russian barley has been exported to the EU in the 2023-2024 marketing year.