Ukrainian farmers to receive €300 million after EU accession. This could eventually rise to €1.2 billion

Upon Ukraine’s accession to the European Union, Ukrainian farmers are likely to be supported under a different mechanism from those used in countries that joined the EU previously. The most likely scenario is a gradual increase in support for Ukraine’s agricultural sector – from €300 million in the first year to €1.2 billion per year within 10 years.

This is according to an analytical report by the Institute for Economic Research and Policy Consulting (IER) and Warsaw Enterprise Institute (WEI), “The Impact of Ukraine’s Accession to the European Union on the Common Agricultural Policy”, prepared with the support of the Open Society Foundations and the International Renaissance Foundation.

The integration of Ukraine’s agricultural sector, which had more than 32.7 million hectares of agricultural land as of 2025, would be one of the largest events in the history of the EU. Given that the EU’s Common Agricultural Policy (CAP) allocates funding primarily based on the area of agricultural land, integrating a country with such a large agricultural land area could significantly alter the distribution of funding under this EU budget programme.

According to estimates by Bruegel, if Ukraine were eligible for EU funds under the current area-based payment rules, it would receive around €85 billion over seven years, or more than €12 billion per year. This would exceed France’s current annual agricultural funding and Poland’s total programme for 2023–2027. IER and WEI analysts arrived at similar estimates in their study: under the current CAP framework, Ukraine could receive between €70 billion and €96.5 billion over seven years.

However, the debate over Ukraine’s EU accession and access to relevant EU budget funds is taking place against the backdrop of a fundamental reform of the EU budget for 2028–2034. The European Commission is proposing to abolish the traditional two-pillar structure of the Common Agricultural Policy and merge agricultural funds with other programmes into National and Regional Partnership Plans, with a total budget of €865 billion. A new instrument, DABIS, is proposed to support farmers. It would introduce a regressive payment scale and set a mandatory annual payment cap of €100,000 per farm.

For Ukraine, this would mean that support for the agricultural sector would amount to approximately €300 million in the first year after accession and gradually increase thereafter, reaching €1.2 billion per year 10 years after Ukraine joins the EU.

“The financial impact on Ukraine’s and the EU’s agricultural sectors following accession will depend not so much on the overall area of Ukraine’s agricultural land as on the future architecture of the EU’s Common Agricultural Policy, the terms of Ukraine’s accession, the length of the transition period, and our ability to comply with EU rules. That is why Ukraine should already be developing land registries, control systems, payment infrastructure, and support mechanisms for small and medium-sized producers,” says Iryna Kosse, Lead Researcher at IER and co-author of the report.

The authors estimate that Ukraine’s medium-sized agricultural enterprises stand to benefit the most. There are around 20,000 such enterprises in Ukraine, with an average landholding of about 485 hectares.

“They are likely to become the main beneficiaries of direct payments, as these enterprises have the administrative capacity needed to comply with EU standards while remaining below the €100,000 payment cap,” emphasised Anastasiia Kropova, Researcher at IER and co-author of the report.

Large agricultural holdings – around 100 companies in Ukraine, with landholdings ranging from 10,000 to 500,000 hectares – would see a limited effect from such payments if the EU’s €100,000 payment cap also applied to related legal entities, which are common in the structure of Ukrainian agricultural holdings.

By contrast, small farms – around 4 million producers that account for 30% of agricultural output, many of which operate outside formal agricultural structures – would face the most significant barriers. These would include formal registration, minimum land-area thresholds for receiving support, and other administrative requirements.

At the same time, Ukraine’s accession would not necessarily have negative consequences for Poland, whose farmers are the fifth-largest beneficiaries of agricultural support, receiving €5.1 billion in 2023. The interests of the two countries do not always conflict.

Ukraine has a strong position in the production of agricultural commodities, while Poland has an advantage in processing higher-value products. “There is significant potential for developing joint Ukraine–Poland supply chains, investing in transport and storage infrastructure, using Polish ports, and sharing Poland’s experience in adapting to CAP rules,” concludes Iryna Kosse.

The report is available below in both English and Polish.