Global prices for grains and oilseeds have started to rise amid the bombing of Black Sea and Danube ports and the slowdown in agricultural exports from Ukraine. The grain corridor is not working, and river ports are becoming the main opportunity for grain exports.

This was discussed on July 31 during a briefing at the Ukrinform media center titled “The Fate of Ukrainian Grain: Ways to Address Exports”.

"The ports of Odesa and the Danube are being bombed, that is why the world will not receive agricultural products on time as it was planned. Prices for grains and oilseeds on the global market have already begun to rise, the price increase may exceed 15%, which threatens the food security of poor countries," said Denys Marchuk, Deputy Chairman of the UAC.

Ukraine and its partners are doing everything possible to make the access to the Black Sea work, but the main alternative is river ports, which have resumed operations after the shelling.

"The main alternative to the grain corridor is the Danube ports. Before the bombing, the potential of river ports was about 2.5 million tons, after the shelling traders did not work for some time, but now the market has recovered, but the cost of grain chartering by ship has increased. Since the cost per ton of transshipment is already higher, this will be an additional financial burden for Ukrainian agricultural producers. Global food prices are rising, but in Ukraine they are very low: today a ton of wheat including VAT is worth about UAH 5,500-6,000. If you take into account the cost of transportation to the port, grain production can be considered as unprofitable one," said Denys Marchuk.

As part of the work on alternative ways, the Ministry of Agrarian Policy and leading agricultural associations have appealed to the European Commission to expand the potential of Ukrainian agricultural exports by 1.5 million tons.

"Ukraine can export 4-4.5 million tons per month, but we need to expand access to the infrastructure of European ports because prices are different. The cost of transporting agricultural products to the ports of Poland, Slovakia, Bulgaria, and Romania is more affordable than to the Adriatic, Germany, the Netherlands, and Italy. In the last case, you need to add 40-45 EUR/ton, and Ukrainian agricultural producers haven’t got this opportunity.

That is why we have asked the European Commission to partially compensate for transit costs, which will allow us to expand access to the European port infrastructure, and this issue is being considered. We also need to improve transportation through transit zones, avoid artificial delays, and we emphasized that it would be better to move phytosanitary inspections of products to the countries where they are sold. The latter will help to avoid congestion when the mass transportation of the new harvest begins," the UAC Deputy Chairman said.