With operations in full swing to shift Ukrainian grain from the nation’s seaports after a six-month war hiatus, the United Nations yesterday set out a goal to move anywhere from 2m to 5m tonnes a month.
Ukraine signed the Black Sea Grain Initiative with its foe, Russia, in Istanbul, last month, creating safe corridors to shift last year’s harvest for an initial period of 120 days. In the past fortnight, cargo ships have entered and left Ukrainian sea ports legally for the first time since Russia invaded on February 24, with the UN tallying a total of some 370,000 tonnes of grain and fertiliser moved thus far. The UN now expects the pace to pick up.
“We’re expecting to see a big uptick in applications for transit,” said Frederick Kenney, interim UN coordinator at the Joint Coordination Centre in Istanbul, which oversees the deal.
Kenney, who has been seconded from the International Maritime Organization (IMO), said shipowners had shown “tremendous interest” and that there were a number of empty grain vessels anchored in Turkey waiting for sales to be arranged so they could travel to Ukraine to collect cargo.
“I can say that we receive literally dozens and dozens of phone calls every day and e-mails [from shipowners] asking when can we get ready to go,” Kenney told reporters at a video press briefing yesterday.
Ships leaving Ukraine have headed for destinations in Turkey, Britain, China, Ireland, Italy and South Korea so far, carrying loads of corn, soya, sunflower meal and sunflower oil. Kenney said the first ship that is coming in to pick up wheat has been cleared and should sail out next week.
Having shifted less than. 400,000 tonnes of agriculture-related merchandise, there is still a mammoth exercise to complete the exports of more than 20m tonnes of last year’s harvest by the end of October when Ukraine’s shipping pact with Russia is set to expire.
At the moment most ship charter inquiries are handy-based, according to brokers Intermodal, due to the shallow draft of ports in the Black Sea area and the short distance that needs to be covered. If the agreement is extended and more shipments will head to Asia, primarily South Korea and China, Intermodal is predicting increased demand for period charters and for bigger vessels.
Congestion is expected to increase in Ukrainian ports as they have been unoperational and unmanned since the beginning of the war and their infrastructures might have been damaged, the Greek broker warned in its latest weekly report. Bad weather is also a concern in the race to move grain from the docks – one ship’s departure today was put on hold due to stormy local conditions.
In further shipping news related to the ongoing war, S&P Global Market Intelligence has published a trade finance compliance white paper.
Key highlights from the white paper include the statistics that as of July 25, there were 414 vessels in the Crimea Joint War Committee (JWC) high-risk zone, an increase from the 373 vessels seen on April 11. Of the 414 vessels, 109 have been dark for seven days or more.
From March to June, there has been an increase of over 2,000 vessels going dark globally, with the associated average dark time decreasing. During the same time period, there was approximately a 25% increase in vessels engaging in a potential port call whilst dark.
Multiple Russian and Syrian bulkers have been dark in areas close to Kerch and Sevastopol in Crimea, after being identified by the US and Ukrainian governments as vessels illicitly carrying stolen grain to Turkey, Syria and parts of Africa.
‘Problem’. Reaction. Solution.
Wash. Rinse. Repeat.