EXPORT OF UKRAINIAN GRAIN IS COMPROMISED BY END OF UN DEAL AND DRONE STRIKES ON DANUBE PORTS
Over the summer, several events severely impacted the export of Ukrainian agricultural goods. Russia first announced that the Black Sea grain corridor agreement, reached a year ago after mediation by the UN and Türkiye was not renewed and expired on 17 July. The deal allowed millions of tonnes of grain and other agricultural products to be exported from Ukraine via its Black Sea ports to 45 countries. Without the agreement, and despite the Ukrainian government call on other nations to help facilitate shipments from their deep-sea ports, it is very unlikely that ships will continue to call at Ukrainian ports. Most importantly, insurers cancelled their program from grain exports. The EU, condemned Russia’s unilateral termination of the agreement, noting that “Russia is further exacerbating the global food security crisis it created by its war of aggression against Ukraine and its blockade of Ukrainian sea ports.”
Ukraine can still export their agricultural products by land and inland waterway, which is supported by the EU Solidarity Lanes: so far, 41 million tonnes of oilseeds, and related products have left Ukraine through the Solidarity Lanes, representing around 60% of Ukraine agricultural exports since the start of the war. However, tensions have been growing between Ukraine and neighbouring EU countries (Poland, Bulgaria, Hungary, Romania and Slovakia), arguing that imports of Ukrainian goods were dropping prices, threatening local producers. Over spring, several discussions at EU level have resulted in a temporary import ban on certain Ukrainian agricultural goods until 15 September. These neighbouring countries threatened to unilaterally impose new import bans if the current agreement is not extended until the end of the year.
At the end of July, Russia launched drone strikes on Ukrainian Danube River port infrastructure close to the border with Romania. The attacks were the first attempts to sabotage movements along the Danube, which handles some 5,000 teu each month, since the start of the war.
Source: Council of the EU, European Commission, ShippingWatch, the Loadstar