Exporting Ukrainian grain via alternative routes has inevitably increased logistics costs, with freight rates at Danube ports more than doubling over the past month and continuing to rise.
The assessment was made by Oleh Khomenko, Director General of the Ukrainian Agribusiness Club, in comments to AgroTimes.
"Freight rates at Danube ports have increased by more than twofold over the past month and continue to climb," Khomenko said, noting that the shift to alternative export routes has significantly raised transportation costs for Ukrainian grain exporters. "More complex logistics have created a widening gap between global and domestic prices," Khomenko said.
"In particular, the price of wheat in Constanța has risen by $30 per tonne over the past week, while domestic grain prices in Ukraine have fallen by UAH 1,000–1,500 per tonne. Given that redirecting Ukrainian grain shipments to the port of Constanța adds another $30–40 per tonne in transportation costs, farmers will, at best, break even on futures contracts scheduled for delivery in September and October," he said.
Khomenko also noted that the Ukrainian government has approved a 30% increase in Ukrainian Railways' freight tariffs, which will further raise domestic transportation costs.
According to the Ukrainian Agribusiness Club, the tariff increase should be postponed until sufficient export volumes have been shipped.
In addition, an unusually hot summer has pushed the Danube River's water level in Romania to its lowest point since 1996, with discharge falling to 1,500–1,700 cubic meters per second.
As a result, vessels are currently loading only 20–30% of their capacity to reduce draft. According to forecasts and seasonal hydrological patterns, the Danube is expected to return to normal water levels in October or November, restoring its shipping capacity.
