The Polish food industry is rushing. Peako: “Solid results” despite the challenges

The Polish food industry, despite many challenges, recorded solid results last year; The industry was at the forefront of the fastest growing sectors of food production in the European Union – Grzegorz Rykaczewski from Bank Pekao said in a report published on Wednesday.

The expert of the agri-food sector of the Macroeconomic Analysis Department of Bank Pekao SA Grzegorz Rykaczewski pointed out that geopolitical challenges have a significant impact on the key segments of the national agri-food sector. He added that changes in trade between the European Union and Ukraine, negotiations with the Mercosur countries and tension in customs policy between the United States, China and the EU are issues that shape new economic realities.

“Last year, the Polish food industry, despite many challenges, recorded solid results. Compared to the entire domestic industrial processing, the positive dynamics of the value of production sold. In 2024, the increase was also achieved in terms of production volume. Its pace exceeded 4 percent, which allowed the native industry to be placed at the forefront of the fastest growing sectors in the European Union” – informed in the report “Geopolitics on a plate. The food industry in the new economic realities”, presented by Pekao.

At the same time, the export of agri -food products increased once again, although its results showed the negative effects of the decrease in the prices of agricultural raw materials from the first half of the year and the strengthening of the Polish currency – it was noted.

In the bank's opinion, the foundations of the national food sector remain strong, which is currently important in the face of high variability caused not only by economic but also political factors.

The Bank's Macroeconomic Analysis Department expert indicated that after Russian aggression to Ukraine, the European Union liberalized access to the EU market for Ukrainian goods; In the agri-food sector, the effect was a significant increase in exports from Ukraine to the EU, which also had its negative consequences. While the need to help Ukraine – as he said – did not arouse social opposition, the dynamically growing imports to the Union and increasingly stronger competitive pressure on EU products, caused an objection to agricultural circles in some member states, mainly bordering with Ukraine.

The result was the introduction of certain quantitative restrictions in import. Ukraine, despite war losses, remains a very large producer and exporter of agricultural raw materials, with a price advantage over the EU. For Poland, this means the need to adapt to new conditions to maintain the pace of development not only in the country, but also in sale to other Member States – said Grzegorz Rykaczewski.

In his opinion, the situation is additionally complicated by the EU trade agreement waiting for finalization with Mercosur countries. He estimated that the agreement itself has a lot of economic for European industry, but will also increase the availability of the EU market for cheaper agricultural raw materials from South America. He added that due to the imported structure of imports, Poland belongs to the group of EU countries most exposed to negative effects. It is a derivative of the assortment in which Mercosur specializes (poultry, beef, sugar), which coincides with the export offer of the Polish food industry.

The Pekao report said that the last months were also a period of intensive changes in the United States and China customs policy, which were the result of growing political tensions in the world. According to the analyst, trade relations between the USA and the EU have changed strongly and probably high variability will remain an element of reality in the following quarters.

“From the point of view of the entire Polish food production industry, even in a situation of a high decrease in exports from Poland and from the EU to the USA, negative effects will be very limited. The decrease in revenues should not exceed 0.3 percent. Just as there should be small losses from American customs duties on the EU, so and slight benefits may be given to Poland from a possible increase in tension on China – USA,” said Rykaczewski. (PAP)

Awy/ Pad/