Alternative logistics cost Ukraine’s agri sector up to $1.5 bln a year

Using alternative export routes could cost Ukraine’s agricultural sector up to $1.5 bln in additional expenses annually. According to the Agriculture Ministry, such logistics are on average at least $50/t more expensive than shipments through deep-sea ports.

Ukraine could potentially export around 30 mln tons of agricultural products via alternative routes. Agriculture Minister Taras Vysotskyi said these additional costs reduce farmers’ ability to invest in machinery, technology, storage and processing, while also forcing them to cut spending on fertilizers and crop protection products.

Land-based routes currently allow Ukraine to export around 45–50% of required volumes, or up to 2.5 mln tons per month. Before maritime logistics were restricted, around 90% of agricultural exports moved through deep-sea ports, while about 70% of Ukraine’s total agricultural production is exported.

High logistics costs could already affect the 2027 planting campaign. Farmers are expected to make final decisions on planted area and crop structure closer to February, depending on their ability to market the future harvest and the predictability of export routes. The ministry says the sector does not have sufficient financial resilience to operate for long under the current logistics costs.

Export restrictions are also creating a shortage of storage capacity for around 11 mln tons of grain. Part of the problem is expected to be addressed through grain bags with capacity of up to 250 tons, where storage costs around $4/t. Ukraine is also working to expand transit routes via the Danube, Constanta, Slovakia and Hungary.

Tags: Ukraine, logistics, alternative routes, agricultural sector