On 20th  December 2007, the European Union  unanimously agreed to suspend import duties on all cereals except oats, buckwheat and millet for the current marketing year - which ends on June 30, 2008. The decision, was proposed the month before by the European Commission, is a reaction to the exceptionally tight situation on the world and EU cereals markets and the record price levels. Although the current levels of border protection for cereals are rather low, import duties are still applied for certain types of grains that are important for the balance of the EU market.

Cereals market situation at the start of the 2007/08 marketing year in July, total stocks (private + intervention) were 13.2 million tonnes below levels at the same time the previous year. This is the result of the modest harvest in 2006/07 and significant withdrawals from EU intervention stocks. In 2007, unfavourable weather conditions reduced the harvest and overall EU production is estimated at 256 million tonnes, a fall of 10 million tonnes or 3.5 percent on the already modest 2006/07 harvest. Output is declining at a time when EU stocks are already low. As a result, the EU will need more imports in 2007/08 than in 2006/07. Traditionally a net exporter, in 2007/08 the EU has become a net importer. European cereals markets have seen a spectacular upsurge in prices since the start of 2007/08.

There are tensions on the small-grain cereals and maize markets, as a result of reduced stocks of common wheat and maize, poorer than forecast quality, and the exhaustion of intervention stocks (currently down to 0.5 million tonnes).