Ukraine. Agricultural logistics 2023/24: The sea corridor saves exports

UkrAgroConsult

Article author:

Maksym Kharchenko

Freight Market Analyst

Exports of agricultural products in June 2024 amounted to 5 M mt, 25% less than in May. Exports of 5 M mt are comparable to the 4.9 M mt recorded in June 2023, but are significantly ahead of June exports in the 2010 and in 2020-2021.

In general, in 2023/24, exports reached 67.3 M mt (-1% to 2022/23) of agricultural products including grains, oilseeds and processed products. During 2023/24, the average monthly export rate amounted to 5.6 M mt.  This was made possible by the Big Odesa ports opening and the exports acceleration in the second half of the season.

In 2023/24 (July-June), the top exported commodities were:

• 57 M mt of corn (-3% compared to 2022/23);
• 9 M mt of wheat (+6%);
• 3 M mt of sunflower oil (+17%;)
• 5 M mt of oilseed meal (+22%).

Overland logistics

In 2023/24 season, agricultural exports by land decreased significantly compared to 2022/23 due to the following:

• High cost of logistics amid lower global grain prices;
• Activity of less expensive sea corridor. This promoted bullish trends in the domestic prices making overland logistics costs even less cost-effective;
• Border blocking and ban on imports of agricultural products in a number of European countries.

Exports by road/vehicles

Vegetable oil and processed food were mainly exported by road. In 2023/24, exports by road totaled 2.06 M mt, down 63% from the previous season. The average monthly export rate was 171 K mt, but by the end of the season (March-June 2024), exports by road decreased to 120-130 K mt per month.

Rail exports

Rail exports in 2023/24 amounted to 9.06 M mt (-19% compared to 2022/23). Average monthly deliveries by rail also decreased in the second half of the season to 600-650 K mt.

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Tags: wheat, Ukraine, sunflower oil, export, grain