The blockade of Ukrainian Black Sea ports poses a risk to the new sunflower harvest, projected at 13,4 million tonnes. Due to restricted logistics, raw material prices have already dropped by 3–5 thousand UAH per tonne.
This was reported by Glavcom, according to the portal PromPolitInform.
The actual cessation of a significant portion of sunflower oil supplies through Ukrainian Black Sea ports creates serious risks for the country’s agricultural sector. The biggest difficulties may arise in autumn, when the new harvest of oilseeds begins to flow massively into the market. This year, collection volumes are projected at 13,4 million tonnes, which is the highest figure over the past three-year period.
If maritime logistics are not restored in time, the domestic market will face a surplus of raw materials amid limited opportunities for oil exports. This was stated by APK-Inform oil market analyst Svitlana Kyrychok. Producers are already feeling the consequences of logistical problems: in early August, sunflowers fell in price by 3–5 thousand UAH per tonne, and demand prices for the new harvest were in some places 10 thousand UAH per tonne lower.
Raw material prices are falling due to logistics problems
Under conditions of a prolonged blockade, processing enterprises may further cut purchases or offer producers lower prices. The reason is that plants do not want to accumulate large stocks of raw materials in the absence of guaranteed sales channels for finished products. Alternative routes for export remain overland crossings at the western border and the Danube ports of Izmail and Reni.
Under favorable conditions, these routes are capable of ensuring Ukrainian oil exports at the level of 350–500 thousand tonnes per month. However, such options cannot completely replace maritime routes, meaning producers risk losing a significant portion of their income. Russian attacks on port infrastructure and vessels in the Black Sea have practically halted agricultural exports, leading to filled storage facilities and falling domestic prices.
Illustrative photo: Міністерство розвитку громад, територій та інфраструктури України / CC BY 4.0
