Ukraine and Russia are significant exporters of grain in the global markets and they together accounted for nearly 30% of the total wheat trade exports annually prior to the conflict between them. Ukraine is a major sunflower oil and corn exporter while Russia is a significant supplier of fertilizer. The two countries came to an agreement that teams would check vessels going out of Ukraine’s port to ensure that no barred people or goods were arriving or departing from the ports.
Agricultural Exports From Ukraine
Ukraine has exported almost 17.2 million tonnes of grains so far in the 2022/23 season, which is down 31.9% from the 25.3 million tonnes exported in the same period of the previous season, citing the Agricultural Ministry’s data. The grains export that the country conducted included about 6.6 million tonnes of wheat, 9.1 million tonnes of corn along with 1.4 million tonnes of barley. The Ministry’s data depicted that about 4 million tonnes of various grains were exported by 28th November 22 which is 31.4% less than in the same period of November in the previous year.
The Government of Ukraine said that the country could harvest about 51 million tonnes of grains in the current year which would be down from a record 86 million tonnes in 2021 due to the loss of land to Russia’s forces and lower yields witnessed.
The Black Sea Grain Initiative (BSGI)
On 22ndJuly’22, the United Nations along with Turkey brokered a safe maritime humanitarian corridor in the Black Sea between Russia and Ukraine. Since the deal, over 400 ships have left from Ukraine’s 3 ports i.e. Chornomorsk, Odesa, and Yuzhny/Pivdennyi, carrying agricultural products (estimated at 11.08 million tonnes). This was done to cater to the global food insecurity that arose out of the conflict and to curb the rising global grain prices but backlogs at the ports still remained significant.
On 17thNovember’22, the BSGI was extended for 120 days which was due to expire on 19thNovember’22 and this renewal has helped ease the concerns over the backlogs.
Reasons For Lower Exports
The major global grain exporters agreed that teams would check the vessels departing from Ukraine’s ports to ensure that no barred people or goods were arriving or departing from them.
Kyiv has put the blame on Russia for the slower start of the exports due to reluctance to speed up the ship inspections. Oleksandr Kubrakov, Ukraine’s Infrastructure Minister said on 27th November’22 that the exports of Ukraine’s grain would not reach 3 million tonnes in November due to Russia trying to limit ship inspections at the ports and that in October, some 4.2 million tonnes of grain left Ukrainian ports.
“It was the custom to conduct 40 inspections a day, now, due to Russia’s position, there are five times fewer checks,” he further stated. Kubrakov also said that 77 ships were queuing to pass the inspection in Turkey and the three Black Sea ports were using only around 50% of their capacity. On the 26th of November, Ukrainian President Volodymyr Zelenskyy hosted a summit in Kyiv with allied nations with a plan to launch the exports of $150 million worth of grain to countries that are most vulnerable to famine and drought.
Kubrakov said US Ambassador to Ukraine Bridget Brink and US Special Sanctions Policy Commissioner James O’Brien discussed ways to strengthen the grain deal when they visited the port of Odesa on the 27th of November while speaking to port and agricultural businesses. If you are wishing to buy agri-commodities in bulk or are wanting to participate in agri-commodities export, then Tradologie.com is the platform for you. Tradologie has 600,000+ verified global buyers and over 70,000 suppliers from 100+ countries in its network and through the platform, you can connect with the relevant ones for your trade with ease.
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