Black Sea infrastructure problems are reshaping grain trade, while Ukraine says domestic food supplies remain secure despite a narrower choice.
Between August 1 and 18, Ukraine exported 899.6 thousand tonnes of agricultural products. Due to logistical challenges, this represents only about 31% of the volume that could have been delivered if the available routes were fully operational.
Grain exports in August fell to 20% of the possible volume
Grain crops were the most severely affected by the restrictions. During the first 18 days of August, 522 thousand tonnes of grain were shipped abroad – approximately one-fifth of potential exports.
Volumes of other agricultural products supplied during this period amounted to:
oilseeds – 63 thousand tonnes;
vegetable oils – 128 thousand tonnes;
meal – 86 thousand tonnes.
Grain crops saw the largest decline in exports. A total of 522 thousand tonnes were exported – only around 20% of the potential volume. At the same time, 63 thousand tonnes of oilseeds, 128 thousand tonnes of vegetable oils, and 86 thousand tonnes of meal were exported. The main problem now is logistics.
– Taras Vysotskyi
Taras Vysotskyi noted that alternative logistics routes make it possible to partially maintain oilseed supplies. However, transporting grain via these routes is considerably more difficult: due to high transportation costs, some export operations may be unprofitable.
Food reserves are sufficient for the domestic market
Despite Russian attacks on distribution centers and certain manufacturing facilities, Ukraine’s existing production capacity is sufficient to meet domestic demand for food. Retail chains may temporarily offer a narrower range of products than usual, but no physical food shortages are expected.
Ukraine has sufficient operational production capacity to cover domestic consumption. There is no threat of a physical food shortage. Products will be available in every locality. However, for some time, consumers may have less choice than they are accustomed to.
– Taras Vysotskyi
No buckwheat shortage is expected this year either. Production is forecast to exceed 80 thousand tonnes, roughly in line with last year’s figure. In the near future, the price of buckwheat groats may remain close to its current level, although an increase of up to 15% is possible.
Wheat prices on Euronext
Problems with Black Sea infrastructure have also affected the global market: wheat quotations have approached a three-year high. As of August 20, milling wheat on the Euronext (MATIF) exchange was priced at:
EUR 226.75 per tonne under the September contract;
EUR 236.75 per tonne under the December contract.
This corresponded to an approximate price of about USD 275 per tonne. Logistical constraints remain the key factor limiting Ukrainian grain exports and affecting the international market.
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