Polish ports block grain exports? An expert on the need for modernization

Wprost.pl: The year is ending, which always prompts summaries. What was the past year like for the Polish grain and agri-food markets?

Monika Piątkowska: The past year was exceptionally difficult for global markets, which were seriously deregulated, especially in the agri-food sector. Unfortunately, Putin’s actions have turned grain into a tool of political and economic warfare. The war caused chaos on international markets, which was also felt in Poland, both as producers and exporters of grain.

Poland is a significant grain producer and net exporter. We export our products to European Union countries such as Spain, Italy and Portugal, which are our traditional importers. Additionally, we direct Polish grain to more distant markets, mainly to African countries, but not only. The war on our eastern border significantly influenced the functioning of these markets, introducing huge disruptions.

Wprost.pl: What were the direct effects of the war on the grain market?

Monika Piątkowska: In the initial period of the war, we observed sharp increases in grain prices on international markets. However, over time, just as quickly, prices began to fall. Additionally, in this difficult situation, there was the transfer of grain from Ukraine, which was another factor influencing the market, although not as important as the protesting farmers tried to present.

In Poland, we produce between 33 and 35 million tons of grain annually. Meanwhile, the Ukrainian grain that reached our market accounted for only 7-8 percent of this amount, i.e. less than 10 percent. I would like to emphasize that the scale of this phenomenon was much smaller than suggested in the public debate.

Wprost.pl: Despite this, farmers’ protests took place in the country. How do you evaluate it?

Monika Piątkowska: We remember these protests and farmers’ revolts, which were unfortunately fueled by politicians. It was alleged that the inflow of Ukrainian grain lowered prices on the Polish market. I would like to clarify that the main problem was Russian grain. Russia aggressively expanded into international markets, offering its grain, as well as grain stolen from Ukraine, at dumped prices.

Wprost.pl: Did Ukrainian grain have any impact on prices in Poland?

Monika Piątkowska: International stock exchanges were of major importance for grain prices, primarily the Paris Stock Exchange, which also shapes grain prices in Poland. Of course, in the eastern regions of our country, where the inflow of Ukrainian grain was greater, prices were slightly lower, but this cannot be considered the main factor. The price drops were primarily the result of the situation on international markets and Russia’s actions.

Russia sold its grain and grain stolen from Ukraine at very low prices in an attempt to strengthen its position on markets, especially African ones. Such actions destabilized the market, which resulted in sharp price drops. Unfortunately, it was these practices that had the greatest impact on reducing the value of grain on world markets, as well as in Poland.

Wprost.pl: Speaking of the international situation, you mentioned that Poland is a net exporter. In the current geopolitical situation, have Polish exporters taken advantage of the opportunity and increased exports?

Monika Piątkowska: Thank you very much for this question. Exporters, both Polish and international, made the most of the opportunities that opened up to Polish grain in this situation. However, there were voices in the media that the capacity of Polish ports, as well as the railway infrastructure, was insufficient. And unfortunately, there is a lot of truth in this.

We have announced the expansion of railway infrastructure, which would support both the transport of grain from Ukraine and the export of our own grain. This is a very important issue, but I must emphasize that Polish terminals and ports are outdated. For example: Panamax, the largest type of ship used to export grain to distant markets, holds approximately 60,000 tons of cargo. In Polish ports, such a ship takes up to two weeks to load, while in other countries it takes only two days.

This shows how huge modernization needs we have in this area. We very much hope, and I say this on behalf of the entire sector, that the ports will not only be expanded, but also modernized. It is crucial to increase the rate of transshipment so that ships can be loaded faster and the export potential of Polish grain can be fully exploited.

Wprost.pl: We talked about exports, we have already discussed what happened on the grain market this year. Nevertheless, grain prices have been extremely volatile this year. What was the main factor influencing these fluctuations? Was the international situation the only reason?

Monika Piątkowska: Mr. Editor, the main factor was the international situation, because grain is a raw material and raw material prices are determined on international stock exchanges. This is a basic principle that must be remembered when analyzing grain trade. These types of products are always subject to global market mechanisms.

This year we have had to deal with several important factors. First, of course, the war in Ukraine and Russia’s policy. Secondly, variable climatic conditions that influenced production not only globally, but also in Poland. We have seen droughts, wildfires and other extreme weather events around the world. Unpredictable conditions also appeared in Poland – heavy rainfall, strong winds and hailstorms. All this had a direct impact on the harvest, both in terms of quantity and quality.

This year’s harvest in Poland amounted to approximately 33-34 million tons. These are not record results, but they are not bad either. Quantitatively, we can talk about a good harvest, but qualitatively the protein content in the grains was lower than expected. This is the result of both climatic conditions and the level of fertilization.

Despite these challenges, I want to clearly emphasize that the quality of Polish grain – like all Polish food – is high. Production in Poland takes place in a safe and healthy way and ensures our country’s food independence.

Wprost.pl: You mentioned climate change. This is a phenomenon we have been dealing with for years. Have Polish farmers managed to adapt to them yet, or do they still pose a big challenge to them?

Monika Piątkowska: Polish farmers have long faced various difficulties, and in recent years these challenges have intensified significantly. When it comes to climate change, it can be said that farmers have become accustomed to these difficulties, as weather-related risks are an inherent part of farming.

However, these natural challenges have been added to by artificially generated risks resulting from EU regulations, such as the European Green Deal. Its goals, such as climate protection, caring for the soil and reducing CO2 emissions, are undoubtedly noble. However, the method of their implementation is controversial because it significantly increases production costs and reduces the competitiveness of Polish agriculture on the European market.

Additionally, in recent years, farmers have had to deal with a sharp increase in energy and gas prices, which has significantly burdened their budgets. Although consumers may no longer remember it, small and medium-sized farms are still affected by these difficulties.

Wprost.pl: How do you assess the impact of the current political situation on agriculture?

Monika Piątkowska: In Poland, unfortunately, we observe a situation in which some politicians treat farmers not as entrepreneurs, but as an electorate. This leads to short-term measures, such as ad hoc subsidies, which may alleviate problems for a while but do not solve them strategically. Farmers themselves say that instead of simple subsidies, they need investments in agriculture – in modern technologies, infrastructure and solutions that will allow them to cope with the challenges of the future.

The answer to changing climatic conditions and other difficulties is precision agriculture, which requires advanced technologies, such as precise fertilization and innovative tools. This should be a direction in which not only the private sector but also the state will invest.