500,000 metric tons instead of 1.5 million: How the maritime blockade caused the grain market in Ukraine to collapse
18 August 14:24
Interview
The Ukrainian grain market has faced a price collapse due to export problems. Wheat, which until recently cost 10,000–10,500 hryvnias per metric ton, is now selling for as low as 6,000–7,000 hryvnias in some places. Denis Marchuk, deputy chairman of the All-Ukrainian Agrarian Council, stated this in an interview with "Komersant Ukrainian".
According to him, the main reason for the price drop is a sharp reduction in opportunities to export grain abroad amid the peak of the harvest season.
“We’re in the middle of the harvest season—up to 30 million metric tons of grains and legumes have already been harvested. There’s a huge supply, but it’s difficult to export it because the sea routes are blocked,” Marchuk explained.
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Alternative routes are currently unable to compensate for maritime exports. According to the expert, about 45% of the produce is transported via the Danube, another 45% by rail, and approximately 10% by road. In the first 13 days of August, only about 500,000 metric tons were exported via these routes.
“Traditionally, by this time of year, we would already have exported 1.5 million metric tons. And we’re capable of exporting 4 million metric tons per month,” Marchuk noted.
At the same time, farmers cannot simply wait for exports to resume. They need funds for fuel, salaries, land rent, and loan repayments.
“That’s why farmers today are simply forced to operate at a loss,” said Marchuk.
According to him, if sea exports are not resumed in the near future, some agricultural enterprises may find themselves on the brink of default.
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