Ukraine's Grain Exports Plagued by Rising Logistics Costs and Heatwave-Stricken Danube
Ukraine's grain exports via alternative routes are causing logistics costs to skyrocket. Oleh Khomenko, Director General of the Ukrainian Agribusiness Club (UCAB), warned that freight rates at Danube ports have more than doubled in a month and continue to rise.
The rerouting of shipments to the Port of Constanța adds an extra $30-40 per tonne to logistics costs. This has created an imbalance between global and domestic prices, with the price of wheat in Constanța increasing by $30 per tonne over the past week, while domestic prices in Ukraine have fallen.
The government's decision to approve a 30% indexation of Ukrainian Railways (Ukrzaliznytsia) freight tariffs will only add to the financial pressure. UCAB urges that this increase be postponed until sufficient export volumes have been exported.