On October 23, in Luxembourg, at the EU Council of Ministers for Agriculture and Fisheries, Member States discussed a situation on the market of agricultural products and food after Russia’s full-scale invasion of Ukraine.
The situation in agriculture in Latvia this year is still complicated and agricultural enterprises might face lasting difficulties. There is a concern that the conflict in Middle East and a possible rise in oil prices could aggravate economic uncertainty even more. In Latvia, the sector of agriculture is still facing increase in costs of production resources but at the same time the fall in prices is showing for manufactured goods, for example, for grain.
Besides, lately, a negative impact of imports of grain from Russia on competitiveness of Latvian grain production sector is increasing both on local and exports markets. It is forecasted that in Russia, in the season 2023/2024 will be the third highest of all times wheat yield, at the same time production costs in Russia are also lower than in the EU, and this damages competitiveness of Latvian grain producers even more. Also, analysis, carried out by the European Commission on market developments shows that Russia will continue exports of wheat in record volumes and at a rapid pace.
Therefore, Armands Krauze, the Minister for Agriculture, expressed concerns at the Council meeting about Russian grain getting on the EU market, and called the European Commission to assess the impact on the nearest to Russia border states and the EU grain sector in general. Taking account of the situation, the Minister for Agriculture invited to start discussing the ban on Russia’s grain imports to the EU Member States. At the same time, the Minister emphasized that this suggestion does not imply restriction of the transit of Russia’s grain to third countries thus, avoiding a negative impact on the global provision of food.