Grain and Oilseeds

20/ 11/ 2013

Following lobbying efforts of the European Business Association, on 21 November 2013 the Verkhovna Rada of Ukraine rejected the Draft Law of Ukraine on Import (Export) Duties to Certain Oilseeds regarding cancellation of Import (Export) Duty on sunflower seeds No.2692 dated 2 April 2013.

Background: On 2 April 2013 the Draft Law of Ukraine on Import (Export) Duties to Certain Oilseedsregarding cancellation Import (Export) Duty on sunflower seeds No.2692 was registered in the Verkhovna Rada of Ukraine. The Draft Law was aimed at cancellation of 10% sunflower seed export duty.

At the time being a ten per cent export duty on sunflower seeds is a key balance factor regulating export of raw materials. However, even with a ten per cent export duty a certain number of seeds (5-10 per cent) is exported. On one hand, it creates a shortage of raw materials and results in shortage at the end of the season. On the other hand, it ensures sound competition and a high price received by the manufacturer. Due to the unique role of Ukrainian sunflower oil in the world market the EU has agreed to save a ten per cent margin for export of sunflower seeds in the negotiations on an agreement on free trade between Ukraine and the EU.

Once the world markets situation remains and Ukrainian sunflower’s ten per cent export duty is cancelled sunflower will be totally exported as a raw material and the oil processing industry will die.

Following the efforts of the EBA Grain & Oilseed Committee, on 21 November 2013 the Verkhovna Rada of Ukraine rejected the Draft Law of Ukraine On Import (Export) Duties to Certain Oilseeds regarding cancellation Import (Export) Duty on sunflower seeds.

This remarkable success achieved due to continuous cooperation of the Government of Ukraine, the Parliament and representatives of the grain and oilseed industry will contribute to further deregulation and, consequently, further development and prosperity of agriculture in Ukraine as a whole.

The European Business Association expresses its sincere gratitude to the Verkhovna Rada of Ukraine Agrarian Policy and Land Relations Committee as well as MPs who have supported this important initiative and we are delighted to share this progress with members of the Association.

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