Eucolait calls for renewed dairy deal to support Ukraine& EU market

Ukraine – Eucolait, the European Dairy Trade Association, has urged the European Commission to reconsider its decision to let the Autonomous Trade Measures (ATMs) expire, warning that the reintroduction of tariffs and quotas could disrupt dairy markets and strain relations with Ukraine.

This comes as trade between Ukraine and the EU will revert to the terms outlined in the EU-Ukraine Association Agreement, as was the case before June 2022, when the Commission initially introduced ATMs to show solidarity with Ukraine in the wake of the Russian invasion.

The ATMs have already been extended once, and a short-term transitional import system will be in place from June 6 to the day the Commission concludes its ongoing review of tariff liberalisation under Article 29 of the Deep and Comprehensive Free Trade Area (DCFTA) and new rules come into force.

The lapse of the ATMs and the subsequent changes will be damaging to the European dairy industry, flags the association.

For the dairy sector, this change means the reintroduction of tariff rate quotas (TRQs) on certain products, most notably butter and milk powders.

In contrast, others, such as cheese and whey, will continue to benefit from duty-free access.

The European Commission has proposed a transitional system to manage quotas on a first-come, first-served basis; however, dairy stakeholders remain concerned.

They fear that the abrupt policy shift could harm both Ukrainian producers, already grappling with the consequences of war, and EU businesses that have come to rely on Ukrainian dairy imports.

Speaking to Food Ingredients First, Eucolait Secretary General Jukka Likitalo explained, “The quota volumes will cap the imports of these products. The impact will be most significant for skimmed milk powder (SMP) as milk powder imports from Ukraine (mainly SMP) exceeded 15,000 metric tons last year and the quota for the remainder of the year is only 7/12 of 5,000 metric tons, so a bit less than 3,000 metric tons.”

Calls for a revised agreement that ensures continued liberalised trade are growing.  Eucolait and other industry voices are urging Brussels and Kyiv to swiftly negotiate a new framework that allows for the free circulation of all dairy products.

They argue that maintaining open trade is not only economically sound but also a vital political signal of the EU’s ongoing support for Ukraine.

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