The Russian invasion of Ukraine has global consequences for food security: millions of tons of grain are stuck on the Black Sea coast. The USA wants to help with exports – but there is no quick solution in sight.
US President Joe Biden says he is working with European allies to solve the blockade of 20 million tons of Ukrainian grain that is stuck on the Black Sea coast because of Russia’s war of aggression. The plan is to build temporary silos on Ukraine’s borders to circumvent the problem of different track gauges in the Ukrainian and European rail systems, Biden said. “Ukraine has a system like Russia has, a track gauge that is different from the track gauge of the other rails in Europe,” he explained. “So we’re going to build temporary silos, on the borders of Ukraine, including in Poland. Then we can get it out of those railcars, into these silos, into railcars in Europe, and then out to the ocean and out to the whole world,” Biden said, looking at the blocked grain exports. “But it takes time.”
“Ukraine will disappear from the market for a long time”
Yesterday, Ukraine’s agriculture minister predicted a global wheat shortage due to the Russian invasion. “Ukraine will disappear from the market for a long time,” Mykola Solskji told Reuters. It’s about three wheat harvests at the same time: “We can’t export last year’s harvest, we can’t catch up with the current harvest to export it, and we don’t actually want to sow the next one.” This is bad for the rest of the world, said Solsky. “What if they come in July or August and they want to buy grain and they turn them down, or the price is $600 a ton?” According to the minister, the problem is exacerbated by the fact that Ukrainian farmers are no longer growing as much wheat due to the Russian blockades. Winter wheat, which is sown from the end of summer, is popular in Ukraine.
Sunflowers and oilseed rape displace wheat
Solskji pointed out that farmers already switched from corn to sunflowers in the spring. It is true that the harvest is smaller in terms of weight per hectare. However, it can be sold for a higher price. A similar effect could now also occur with wheat, Solskji said. There is strong demand for sunflowers and rapeseed in Europe, which is likely to crowd out everything else – including wheat and corn. He assumes that in autumn the area advertised for winter wheat will be a “significant percentage” smaller. Ukraine is one of the world’s largest exporters of wheat, corn and sunflower oil. However, the war and the Russian blockade of ports have halted much of these exports, threatening the world’s food supply. Before the war, Ukraine exported up to six million tons of grain per month. The Russian blockade reduced the quantity to 300,000 tons in March, since then it has recovered somewhat. Solskji expressed confidence that exports via the western border and smaller Danube ports could surpass two million tons in June. Despite this, Ukraine is faced with huge surpluses of up to 60 million tons of grain and oil seeds for which there are no storage facilities.
