‘A disaster’: The ‘impossible’ task facing Ukrainian grain traders

A Ukrainian grain chief has detailed the “impossible” task facing Ukrainian grain exporters and what that means for the world market.

The head of Ukraine’s peak grain organisation received a standing ovation from hundreds of Australian grain traders on Wednesday after an emotional speech on the state of the country’s grain exports.

Speaking at the Australian Grain Industry Conference in Melbourne, Ukrainian Grain Association president Mykola Gorbachov detailed the “impossible” task farmers and grain traders faced in Ukraine when trying to get stocks out of the country.

Reopening port infrastructure was crucial to exporting 10 million tonnes of Ukrainian wheat and 10 million tonnes of corn this season and preventing multiple global famines, he said.

“If we will not unlock the port, I do not even believe in these figures,” he said.

On Saturday Russian missiles hit port infrastructure in Odessa just hours after Russia and Ukraine signed long-anticipated deals to allow the safe export of grain.

Unless ports reopen, Ukrainian farmers will struggle to store this year’s harvest.

Mr Gorbachov said rail, truck and barge infrastructure was insufficient to export the necessary volumes of grain out of Ukraine.

“(European) railway line(s) are not ready to accept such number of trains. Their port facilities, they are not able to handle such volume of grain.

“It’s not even a question of price. Technically, it’s impossible to satisfy such big demand from Ukraine,” he said.

Meanwhile trucks were banking up and unable to move at speed.

“I’ve been on the border to Romania and I’ve seen a 17 kilometres truck queue. (The drivers) stay there for 10 days. And you have to feed them you have to build for them refreshment points, you have to build for them toilets,” he said.

Previous season exports were much lower than expected, meaning there were large volumes of un-exported stocks in the country, Mr Gorbachov said.

Last season Ukraine exported 19 million tonnes out of an expected 25-million-tonne wheat export program and just 23 million tonnes out of a 35-million-tonne program.

Given the chance to export some of their grain stocks, Ukrainian farmers were likely to prioritise sunflower and canola, because the prices were higher than for wheat and corn, he said.

Farmers were facing losses of between $200 and $400 per tonne to transport wheat to the borders of Ukraine, making the exercise financially unviable, he said.

There is a lot at stake, with World Food Program executive director David Beasley in May warning 44 million people could be “marching towards starvation” if Ukrainian ports did not resume exports.

Australian grain traders thanked Mr Gorbachov for his speech to the conference with a standing ovation, and conference organisers pledged to donate funds to Ukraine.