More Bulkers Heading to Ukraine Helping to Lower Shipping Costs
Additional vessels from a broader range of shipping companies are beginning to use Ukraine’s humanitarian shipping corridor. While volumes remain only a fraction of the amount of exports during the year-long Black Sea agreement, it still demonstrates the success of restoring grain exports and expanding the operations to include iron ore.
Ukraine’s Vice Prime Minister Oleksandr Kubrakov again went on to social media today to hail the movement of a total of eight bulkers, including five additional inbound vessels. He reported that the eight vessels would be transporting more than 247,000 tons of agricultural products as well as iron ore from the ports of Chornomorsk and Yuzhnyi.
The three vessels that departed Ukraine on Sunday, October 1, had however been in port for nearly 10 days showing the slower pace of the operations. The Azara (13,898 dwt registered in Palau), the Eneida (45,572 dwt registered in Liberia), and the Ying Hau 01 (74,759 dwt registered in Liberia) followed the now familiar route along the western coastline of the Black Sea moving quickly from Ukraine into Romanian waters. They arrived during the day on Monday, October 2, off Turkey apparently without intervention.
The inbound vessels are mostly smaller-sized bulkers but significantly include the first one managed from Greece as well as two managed by a German company through Singapore. The largest of the vessels is the 32,834 dwt bulker Forza Doria registered in Barbados coming from Libya to Chornomorsk. The Greek-managed Danny Boy (28,386 dwt registered in the Bahamas) is coming from Italy to the Odesa region. The other vessels include the Olga (18,319 dwt registered in Liberia) and the Ida (18,172 dwt registered in Liberia), both managed by Blumenthal Asia, part of Johann M K Blumenthal of Hamburg, Germany. The fifth vessel is the New Legacy (28,665 dwt registered in Belize) coming from Libya to Yuzhnyi. As a safety measure, the vessels appear to be turning off their AIS signal while sailing in the Black Sea but have now reached Ukraine.
With the support of insurance brokers who have been working to provide wartime coverage, the corridor seems to be gaining some momentum and having an impact on Ukraine’s exports. Reuters is quoting Ukraine’s farm minister reporting the success of the corridor. Mykola Solsky is quoted from an appearance on national television saying that freight costs are significantly lower now and likely to fall further.
Freight costs are reported to be down 30 to 40 percent in the last two weeks. While conceding it is still expensive Reuters quotes Solsky pointing out it is cheaper and expected to continue to decline.
Ukraine is expected to harvest 70 million tons of grain and oilseed in 2023 according to Reuters. These products make up a large portion of the country’s exports and are a significant contributor to the economy as well as supporting Ukraine’s farming communities.
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