Alternative routes for Ukrainian exports of grains, oilseeds and processed products via the Danube region, railways and trucks have historically been able to handle no more than 50% of the volumes shipped through the Greater Odesa ports, even during periods of their most intensive use.
Ukraine’s Minister of Agrarian Policy and Food Taras Vysotskyi said this in an interview with DW.
“Given the harvest forecast, Ukraine can export more than 60 mln tons of agricultural products, or around 5 mln tons per month. This means that it would be physically impossible to redirect half of this volume, around 30 mln tons, through alternative routes. Their maximum average capacity is up to 2.5 mln tons per month. In some months it could reach 3 mln tons, but the average will not be higher,” he said.
Vysotskyi added that using alternative export routes would increase logistics costs by at least $50/t.
“With an export potential of 60 mln tons, this means $3 bln in additional costs. Neither agricultural producers nor the state budget have sufficient resources to compensate for this. Therefore, the main and, essentially, the only medium-term solution is to restore shipping through the Greater Odesa ports,” Vysotskyi stressed.
Among the alternative routes, the Danube has the largest capacity and previously accounted for up to 60% of alternative cargo flows, followed by rail and road transport. However, due to low water levels, the Danube is expected to handle no more than 40% of planned volumes in August-September.
“August volumes will not be large. A maximum of around 1.5 mln tons can be exported via alternative routes in August, compared with the potential average capacity of 2.5 mln tons. It takes time to scale up flows, rail infrastructure may already be occupied by European operators, and storage and accumulation capacities are also limited. Such logistics require at least two months of planning. These volumes cannot appear immediately, but the work is already underway,” Vysotskyi concluded.
