Russia urged to unblock Ukraine’s ports to free up grain export

By Jane Byrne contact

- Last updated on GMT

© GettyImages/tomazl
© GettyImages/tomazl

Related tags: Ukraine, Poland, Corn, soybeans

EU foreign policy chief, Josep Borrell, called on Russia today to unblock Ukraine’s ports to enable the export of grain.

The consequences of the war are becoming very dangerous, he said, not only for Ukraine, but for the whole world. He insisted that it was not the European sanctions that were creating this crisis.

“It is the war which is creating price increases and scarcity of energy and food,”​ stressed Borrell, as foreign ministers met to discuss the situation in the Black Sea.

“Our sanctions do not target food, do not target fertilizers. Anybody that wants to buy Russian food and fertilizers, they can do it – no obstacles. Economic actors have to know that these products from Russia are out of the scope of our sanctions, so they can operate, they can buy, they can transport, they can insure it.”

The EU, continued Borrell, is also supporting the UN's negotiations with Russia to reopen the Black Sea ports.

Grain export by train 

Gdansk in Poland and Constanta in Romania are being increasingly used for bulk shipments of Ukrainian grain. Though cost and logistical bottlenecks remain in terms of getting the grain from the war-torn country to those ports.

Germany confirmed that it is supporting Poland and Romania in adapting their railways to enable more grain volumes from Ukraine to get to those export terminals, according to Reuters.

The railway tracks need to be modernized, we need the right cargo wagons - the German government is working on this with many other actors,” ​said German foreign minister, Annalena Baerbock, as she arrived for the meeting with her EU counterparts in Luxembourg.

Exports via inland routes

Last week, soy organization, Donau Soja, outlined how Ukrainian farmers have been making massive efforts to increase exports via alternative inland routes, despite the critical situation with blocked Black Sea and Azov Sea ports. In May alone, exports by road, rail, and river – the Danube – tripled, it reported. 

Ukraine’s export terminal, Reni, located on the Danube River, has become an important transit hub, noted Susanne Fromwald, senior advisor, Donau Soja.

wartime logistics road rail ferry Ukraine exports
Ukrainian ministry of agriculture data on inland transit exports of grain and oilseeds for May 2022

While Ukraine and partner countries, as well as the EU, at all levels, are working to increase the capacity of alternative logistics routes for the conflict-hit country's grain and oilseeds exports by removing bureaucratic and technical obstacles, that capacity currently stands at around 1.5m mt per month, according to the Ukrainian Grain Association. 

"Exports from Ukraine in the new season could reach 30m mt if the capacity of crossings at the borders of Ukraine were doubled. Given the current capacity, Ukraine can count on exports of 12-18m mt in the 2022/2023 marketing year,"​ said the trade group.

Planted area

Meanwhile, Ukrainian officials have reported an overall decrease of 25% in planted areas due to the war. Corn is the worst affected, with planted area down 16% from 2021, at 4.6 million hectares.

Sunflower, though, is almost at prior year levels, at 4.7 million hectares, and Ukraine has planted 1.25 million hectares of soy this year, on par with the area planted in 2021, according to the Ukrainian ministry of agriculture. That could lead to an output of 2.8m mt of soy, said Donau Soja.

Related topics: Markets, Europe, Oilseeds, Grains

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