U.S. gives pessimistic forecast on Ukraine's grain exports, Bloomberg reveals related data
On August 7, Bloomberg reported that U.S. analysts pointed out that the future direction of the grain market largely depends on the situation in the Black Sea. Due to Russian military attacks disrupting operations at Black Sea ports, this season's Ukrainian agricultural exports could shrink by more than half, putting the country's most important source of foreign exchange revenue at significant risk.
The report stated that Ukraine is one of the world's major grain exporters; last year, agriculture contributed over half of the country's total foreign exchange earnings from exports. Odessa Port handles about 90% of Ukraine’s grain shipments, but Russian strikes have severed this vital route. Meanwhile, alternative routes along the Danube River are hindered by drought, with river levels dropping to historic lows, severely limiting transport capacity.
As the new harvest is gradually collected and stored, storage pressure intensifies, which may also disrupt domestic grain prices. According to the report, Ukraine’s total grain storage capacity is 59 million tons, and by early November, it might already be completely full; by late autumn, the storage shortfall could reach as high as 11 million tons.
Kyiv has reached an agreement with Bucharest to expand grain exports via Romania’s Constanta Port. Grain shipments have been rerouted through Romania, Slovakia, and Hungary, but the volume carried by these alternative routes still cannot compensate for the gap left by the loss of Odessa Port.
Bloomberg cited U.S. assessments: while the U.S. Department of Agriculture forecasts Ukrainian wheat exports could reach 14.5 million tons, the U.S. Foreign Agricultural Service estimates actual exports will only reach 10.8 million tons.
Corn export declines are similarly substantial. U.S. experts estimate corn exports will amount to just 14 million tons—nearly 39% lower than earlier official projections. The future trajectory of the grain market hinges heavily on developments in the Black Sea, the capacity of alternative logistics routes, and the progress of aid projects supporting Ukraine’s agriculture.
According to Ukraine’s Ministry of Agrarian Policy, this season’s agricultural exports could decline by 54%, falling from an initial forecast of 64.4 million tons to just 29.6 million tons.
Wheat exports are hit the hardest, with expected volumes dropping to 8.3 million tons—also a reduction of more than half.
On August 4, Taras Vysotskyi, Minister of Agrarian Policy of Ukraine, stated that direct losses in the agricultural sector alone could range between $1.5 billion and $3 billion.
Original article: toutiao.com/article/1872916073217096/
Disclaimer: This article represents the personal views of the author