“Enormous losses”: Russian wheat exports have plummeted to a 16-year low due to the blockade of Black Sea ports
22 August 17:15
Russian wheat exports in August could be the lowest for that month in the past 16 years, according to [Komersant], citing Russian propaganda media.
According to their estimates, grain exporters will be able to ship 2.2 million metric tons of wheat abroad—half as much as in August 2023 (4.5 million metric tons), and 56% below the average for this month over the past five years. The only time Russia exported less wheat in August was in 2010, when the government imposed a ban on grain exports due to a drought.
Currently, all major grain ports on the Black Sea and the Sea of Azov are paralyzed. Last week, following drone attacks, three grain terminals at the port of Novorossiysk—through which a total of about 25 million metric tons of grain was exported—were shut down. In late July, a drone strike halted operations at the grain terminal in Taman, and a few weeks earlier, authorities suspended shipping through the Kerch Strait. Only the port of Tuapse remains for exports, but its capacity is modest at just 250,000 metric tons per month.
If grain terminal operations are not restored by the end of the month, export volumes could fall even below 2.2 million metric tons.
For farmers, this means “colossal losses,” warns Arkady Zlochevsky, president of the Russian Grain Union: “Storage facilities are filling up every day, while demand has stalled; exporters have practically stopped buying grain.”
Due to excess supply, domestic grain prices have fallen—by 18% since June. And farmers are forced to sell their harvest below cost. The consequences of this will become apparent next season, Zlochevsky believes: “There’s nowhere to get money from, and credit is unavailable. If we don’t receive sufficient funding, the winter planting season will be a disaster.”
Due to the shutdown of grain terminals, freight carriers in southern Russia—the Krasnodar Krai, Rostov Oblast, and Stavropol Krai—have found themselves on the brink of survival. Revenue at some companies has plummeted by 90%, and employees are being forced to take unpaid leave.
“As the timeline for the full resumption of operations at the Black Sea terminals remains unknown, carriers in the south remain under serious financial pressure,” notes KSM Logistics.
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