Ukraine’s Grain Exports Plunge After Russian Strikes

Ukrainian farmers are facing serious problems after Russian attacks nearly halted exports through the country’s Black Sea ports. Ukraine is one of the world’s largest producers of wheat, corn and sunflowers, with around 90% of its grain and oilseed exports passing through Black Sea ports before the latest disruption. Recent reporting supports the roughly 90% figure.

The disruption comes at the peak of the harvest season. Warehouses are filling up, domestic prices are falling and farmers are losing the income they need to pay wages, buy fuel and finance autumn planting. Ukraine expects to harvest approximately 60 million metric tons of grain this year.

According to the report, Russia carried out more than 70 attacks on Black Sea port infrastructure and 62 strikes on vessels in July and early August.

Grain exports fell by 75% year over year during the first two weeks of August. Moscow says it is targeting military infrastructure, logistics and vessels transporting foreign weapons. Russia has publicly maintained that its recent strikes targeted Ukrainian port infrastructure and vessels supporting the Ukrainian military.

Alternative export routes are constrained by low water levels on the Danube, Russian attacks on railways, stricter trade regulations with the European Union and tensions with Poland. Ukrainian officials have warned that alternative routes will not be able to compensate fully for lost Black Sea capacity.

The National Bank of Ukraine estimates that the disruption will cost the country approximately $2.5bn in foreign exchange earnings by the end of the year.

(Reuters, bak)