Traders Seeking Buyers for Discounted Ukrainian Grain Cargoes Coming to Market

By Michael Hogan

HAMBURG, Aug 5 (Reuters) – Worldwide and native merchants began to supply extra Ukrainian-origin grain on the market on Friday as information of the primary cargo from the nation since Russia’s invasion boosted confidence in a deal to unblock exports from its sea ports.

Costs have been discounted, with roughly 20 million tonnes of grain from final 12 months’s crops nonetheless caught within the nation. 

Diplomatic efforts have focussed on discovering a technique to transport round 1.5 million tonnes of grain loaded on ships or housed in port storage and hundreds of thousands extra in silos throughout the nation, in addition to large volumes from the continuing harvest.

The July 22 deal brokered by the United Nations and Turkey paved the best way for the resumption of grain shipments from Ukraine after U.N. companies warned a rising international meals disaster would result in hunger and mass migration on an unprecedented scale. 

“I believe there’s extra optimism rising, particularly with the information that the primary empty ship goes to Ukraine to select up cargo,” a European dealer mentioned. A Turkish bulk service was anticipated to reach within the Ukrainian Black Sea port of Chornomorsk on Friday.

Traders mentioned gives included a consignment of fifty,000 tonnes of Ukrainian 11.5% protein milling wheat for August cargo at $310 a tonne on a free on board (fob) foundation from Chornomorsk, and one other consignment of 30,000 tonnes for loading in one of many protected hall ports at $320 a tonne fob. 

Costs supplied are about $10-$20 cheaper than these of Russian 11.5% milling wheat from Russian Black Sea ports. 

NEW HOMES NEEDED

There have been roughly 70 ships stranded in Ukraine when the battle started in February, a few of which had already been loaded with grain. The primary left the port of Odesa for Lebanon on Monday and three extra have been scheduled to depart on Friday. 

Most offers to purchase grain from Ukraine have been cancelled after the invasion, so sellers want to seek out new houses for the cargoes, merchants mentioned.

Ukraine’s Seaport Authority earlier this week mentioned 480,000 tonnes of wheat, vegetable oil and corn had been loaded onto ships on the three ports at present concerned within the protected hall scheme, Pivdenny, Odesa and Chornomorsk.

One other million tonnes of grain is saved in grain terminals and warehouses of Ukrainian ports, the authority mentioned.

The overwhelming majority of the nation’s stockpiles, nevertheless, are unfold throughout the nation, with farm silos crammed full and farmers repurposing cow barns and workshops to retailer provides.

Transporting them to ports could show difficult because the battle continues.

Egypt, usually the world’s largest wheat importer, depends closely on imports from the Black Sea area, and its Basic Authority For Provide Commodities (GASC) had round 300,000 tonnes of Ukrainian wheat booked for February and March supply. 

GASC cancelled the contracts for 4 cargoes, totalling 240,000 tonnes, which by no means loaded however a fifth loaded cargo remains to be anticipated to sail.

Traders mentioned the cargo was inspected by Egyptian officers earlier than the battle started and it’s not but clear if it is going to be inspected once more given the period of time which has elapsed.

(Extra reporting by Sarah El Safty in Cairo; Writing by Nigel Hunt; Modifying by Veronica Brown and Jan Harvey)

(c) Copyright Thomson Reuters 2022.