The Russia-Ukraine war has added to the increasing woes of the worldwide supply chain industry by altering geopolitics and also owing to its far-reaching effects on worldwide food security.
Among the several disruptions it has resulted in, one of the most far-reaching ones was to agricultural supply chains.
The Russian termination of the grain agreement in July 2023 resulted in a de facto block on Ukraine’s cargo vessels. The deal that permitted Kyiv to export food crops across the Black Sea was critical in maintaining stability in the global food rates.
Since then, the arrival of the first cargo ships – the bulk carrier dubbed Aroyat and the cargo vessel named Resilient Africa – at one of Ukraine’s ports has given hope to food supply chains, especially those affecting countries of Africa and the Middle East. The vessels will likely transport about 22,000 tons of wheat to Asian and African nations.
This is because Ukrainian grain exports have immense importance, particularly in regions grappling with food shortages. It serves as a critical source of foreign exchange besides playing a vital role in the global food markets.
Both vessels embraced the coast as they reached Ukrainian waters on Saturday, per data received from a leading marine traffic tracking website.
Resilient Africa had set sail from Romania’s port of Constanta, and Aroyat had set off from a port-based in Turkey.
The ongoing war has disrupted maritime channels and targeted grain facilities and ports simultaneously. Russian actions have compelled Ukraine to trial alternative transportation options, like rail and road, via EU nations, even though this comes with complications.
The effect of the war on agricultural supply chains hits the risky establishment of safe corridors for cargo ships. The Black Sea, a central theatre in this ongoing conflict, has made the endeavour even more difficult as Ukraine contests Russian naval dominance.
Besides, Russia has also struck Ukrainian Danube River ports at Reni and Izmail, which are being used as an alternative to the primary ports along the Black Sea.
Discussions to renew the grain agreement are yet to bear fruit. Meanwhile, Ukraine has already sought a unilateral means of facilitating the exports.
Agriculture specialists say that, even though Ukraine has successfully boosted the volume of goods it transports via the ports along the Danube River, the process does not lack risks. It is also more expensive, weakening a critical sector of the Ukrainian economy.
References: logisticsinsider.in, deccanherald.com, pbs.org
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