During the farmers' meeting with the Minister of Agriculture, Czesław Siekierski, and the Speaker of the Sejm, Szymon Hołownia, Jerzy Wierzbicki emphasized three main issues that may soon significantly affect the functioning of the agricultural industry and the economics of production.
Ukraine's accession to the European Union
The first issue is Ukraine's accession to the European Union. Many experts emphasize that the formalities may take about 7 years, which in practice is not a very long time. All the more so, EU countries and their agricultural markets should be logistically prepared to include such a large agricultural producer in their structures. As Ursula von der Leyen emphasized, Ukraine has taken all the steps we recommended and fulfilled the conditions we formulated. Therefore, I believe that the European Union should start accession negotiations with Ukraine by the end of this month.
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As Jerzy Wierzbicki, president of the Polish Association of Beef Cattle Producers, emphasized at a meeting in the Sejm: – Ukraine is a huge challenge for us, we have a problem with perception in the European Union, because the south of Europe has always been buying grain from Ukraine. When the Irish hear that Ukraine is to have access to the market, they think of cheap grain for animal production, they do not realize that Ukraine is like an elephant in a china shop on agricultural markets. It will bring about profound change throughout Europe. When we talked and fought for the negotiations with Mercosur on agriculture to be severely limited, i.e. to restrict access to the market, everyone understood this challenge. When we talk about Ukraine, there is unfortunately dissonance among organizations and among member states. Therefore, our role is to try to change this, to convince other agricultural organizations and other member states that this is a huge challenge. There must be some solutions that will provide Ukraine with limited access to the market for a transitional period. When will Ukraine adapt to the requirements of the European market, but more importantly, when will European agriculture, including Polish agriculture, have a chance to adapt to competing with Ukraine? Funds will also be needed for this, and this is the role of both the minister and MEPs, and our role to lobby for it.
Decarbonization balance – will indirectly put pressure on farmers
The next issue mentioned by Wierzbicki is the Green Deal, which still worries farmers. – In the context of the Green Deal, next year there will be an obligation to report decarbonization in the financial system, i.e. in banks, retail chains such as Lidl and Biedronka, large suppliers and large companies. They will all be obliged to report the debonification balance. These will be non-financial reports, but constructed in the same way as financial reports. There won't be much room for greenwashing or for pretending that something is being done. This tool, managed by the Directorate-General for Finance, will be monitored. We will start competing not only with lower prices and better quality, but also with the amount of carbon dioxide reduction. And it's coming. Unfortunately, there is some peace and a bit on our side, because it will not apply to small, medium-sized enterprises or farmers, but only apparently. Pressure from banks, cheaper loans for those who decarbonize, retail chains that want to include the reduction in their balance sheets, large companies and farmers. Farmers will try to look for these reserves, especially since livestock supplies account for approximately 80% of emissions in the balance of meat production.
Deforestation – obligation to report the origin of goods from 2025.
Another topic discussed by Jerzy Wierzbicki is the commonly known EU deforestation regulation 2023/1115. In practice, it should be implemented from the beginning of 2025. The law obliges entrepreneurs to check, report and trace the origin of goods imported to the EU to ensure that their production does not result in excessive deforestation and forest degradation. No specific country or product will be affected by the ban. However, companies will only be able to sell products in the EU if the product supplier issues a so-called declaration of due diligence. It will confirm that the product does not come from deforested areas or caused the degradation of forests, including irreplaceable primary forests, after December 31, 2020. Businesses will also need to check whether these products comply with the relevant regulations of the country in which they are manufactured. This requirement also applies to human rights and the rights of indigenous peoples.
Severe penalties
The new rules cover: cattle, cocoa, coffee, palm oil, soy and wood, as well as products that contain, were fed with or were made from these goods (such as leather, chocolate and furniture).
Companies will collect relevant information, for example geolocation coordinates. Relevant EU authorities will have access to them and will carry out inspections using satellite monitoring and DNA analysis tools. This way, they will check where the products come from.
Penalties for non-compliance will be proportionate and dissuasive. The maximum fine will be at least 4% of the total annual turnover in the Union of the entity or commercial undertaking that does not comply with the rules.
Deforestation will affect the availability and price of soybeans
Wierzbicki clearly noted that this issue is practically unnoticed, and may significantly affect, for example, the soybean meal market, its availability and price.
– This is a regulation that gets us into damn problems. From the end of December, rules will enter into force in the European Union, covering primarily soy. The EU is unprepared for this solution, if it were to enter, it would disrupt the supply of soy, disrupt the supply of feed for poultry and pork. The regulation will cause huge disruptions. I heard the opinion that soybean suppliers to Europe withheld contracts after January 1 because they are not sure under what conditions they will be able to make these deliveries. This is the next thing that the Polish government, here Minister Siekierski, is lobbying right now and must lobby in our interest. And we also need to lobby to absolutely postpone the date of entry into force. This is a huge challenge.
