Ukraine is known as the breadbasket of Europe, but the Russia-Ukraine war disrupted agriculture supplies from the country, creating ripples beyond the region and raising concerns around global food security risks. Vladyslav Vlasiuk, adviser to Ukraine President Volodymyr Zelensky and a sanctions expert, talks to Rohan Somwanshi and Lalita AVD about the future of Ukraine’s grain markets and how the country aims to alleviate food security risks.
What is the current situation of agriculture in Ukraine? What challenges are Ukrainian farmers facing in terms of growing crops and exporting the harvest?
There is, so far, just one challenge, and the name of the challenge is Russia.
Now, we have much less agriculture lands available as some are temporarily occupied and some are close to the war frontlines. Some of the lands are mined, so we are just trying to de-mine them. And then there is also the navigation issue — being able to send shipments from the Odessa port is a bit challenging, although we’ve managed to do it.
We are sending shipments from the ports now, but suppliers have to stick to some very limited sea routes, given the threat of the Russian navy and potential missile attacks.
In 2023, we exported almost as much as we exported in the pre-war era. That means, with the help of our partners, we managed to overcome those challenges.
How is the Black Sea port situation as of now?
At least 70% of Ukrainian grains are shipped from the Black Sea routes. The vessels go from the Odessa or Chornomorsk ports to the Danube River and then up the river and to some Romanian ports, and from there grains are distributed further.
We are not sending shipments from regular routes, and that’s a challenge. There was quite a lot of logistical problems to resolve, and we’ve done that with the help our partners.
Our war strategy has put Russian navy fleet farther away, really limiting the ability to control. But again, there is a lot of mines in the water.
The shipments could go, but with a rather expensive insurance and the risks are still quite high. So again, that is something which is not really helping Ukraine to continue exporting from the Black Sea routes.
Ukraine is exploring new export routes along the Danube River. How much grain can be exported via these new routes? How effective are these routes compared to the Black Sea route?
In the wake of the ongoing war between Russia and Ukraine, the Danube route has become one of the main transit routes for exporting Ukrainian agricultural products. With the functioning of the maritime corridor from the Ukrainian seaports of the Black Sea, the Danube route remains extremely important for Ukraine.
Around 20% of Ukrainian agricultural products are exported through the Danube ports, with 1.13 million mt of grains, oilseeds and vegetable oils exported through this route in January and 1.17 million mt in February. The potential capacity of the Danube route is up to 3 million mt per month.
At the same time, through our own Ukrainian seaports, we have the experience of exporting 8 million mt per month, which is far from the limit of possibilities.
How much wheat, corn and sunflower oil is Ukraine eyeing to export in 2024? What is the production forecast?
Ukraine is expected to export about 11 million mt of wheat, about 20 million mt of corn and 5.5 million mt of sunflower oil in 2024 — all higher from 2023 levels.
Similarly, our wheat, corn and sunflower production are seen rising to 19.2 million mt, 26.75 million mt and 12.4 million mt in 2024, respectively.
China was one of the largest buyers of Ukrainian grains and vegetable oil. How are the current trade relations between the two countries? Are you seeing China actively buying or planning to buy Ukrainian agriculture produce?
China has always been a quite important trade partner in the agricultural area, and I think we’ll continue the same way moving forward.
In terms of trade business, I think the relation is really strong and developing — and I think that we also appreciate the role of China in terms of trying to make this work.
How is the Grain from Ukraine Initiative helping alleviate food security risks? How much grain Ukraine is looking to export through this humanitarian program?
The Ukrainian President Volodymyr Zelensky came up with this idea to launch the Grain from Ukraine Initiative, which stems from an emotional past when Ukraine faced war and famine more than 100 years ago. Being aware of food supply disruptions, we wanted to be able to continue sharing food and grains to limit food security risks, as it creates extra demand for agriculture products. It’s also important to show to some of the Global South countries that Ukraine is there to care about their food supplies.
Through this initiative, we have so far managed to send seven to eight grain shipment deliveries, including wheat, most recently to Sudan. Another wheat shipment at the end of March will be sent to Sudan. And over the next couple of months, we plan to send at least three more grain shipments to Mozambique, Malawi and Palestine.
In the beginning, we were aiming to send 50 shipments through this initiative, but we are not quite there yet. Now, we are not just looking to send wheat or grain but also vegetable oil, which will allow us to send at least 20 shipments.
Which country would be the biggest benefactor from this grain initiative? Are you looking beyond Africa?
We’ve sent grain shipment to Yemen so far, and we are certainly looking at Palestine. There was also an idea of sending some grains to Afghanistan. Some Latin American countries were also considered, including Venezuela. But again, there are different issues to be considered, including logistical challenges. For example, even sending to the west coast of Africa is something more challenging for us, given the cost of shipment. Sending even beyond Africa would just mean more extra costs for the shipment itself against actual food costs.
