Shipment of agricultural products from the Chornomorsk seaport (Odesa region), whose infrastructure was severely damaged by a Russian missile attack last week, is gradually resuming, Spike Brokers brokerage company reported in a telegram channel.
The brokers noted that in 2023, the share of the Chornomorsk port in the structure of export shipments by water transport was 36%, while the Danube ports accounted for 32%, the Odesa port – 17%, and the Pivdenny port – 15%.
“Over the past week, freight rates for the transportation of corn by ‘coaster’ to the east coast of Italy decreased by $3, to Spain and Israel – by $2. The freight for the transportation of grain by panamaxes from the deep-water ports of Odesa to China and Vietnam decreased by $4,” the experts noted.
As of April 22, the rates for transportation from the port of Chornomorsk to Italy (east coast) amounted to $29-30 (30-35 thousand tons), Spain (Mediterranean) – $30-32 (30-35 thousand tons), Vietnam – $52-54 (60-65 thousand tons), China – $54-56 (60-65 thousand tons).
At the same time, the market rates for transportation by freight from the port of Izmail to the port of Constanta (Romania) as of the specified date are EUR18-22 (4.5-5 thousand tons), to the ports of the Mediterranean coast of Spain – $35-37 (30-35 thousand tons). The rates of transportation from the port of Reni to the ports of Israel range from $33-35 (30-35 thsd tonnes), Spike Brokers stated.
According to a grain market source, who wished to remain anonymous, such a restriction could lead to temporary disruptions in the delivery of products to the terminals of Kernel, Risoil and Viterra groups. In addition, the shutdown of grain terminals could lead to a reduction in April exports of Ukrainian grain via the Black Sea grain corridor to 5 million tons, compared to the expected 8 million tons.
As reported, on April 10, the Russian occupiers damaged railroad sidings to a number of grain terminals located in the port of Chornomorsk during the morning shelling of Odesa region. This resulted in temporary disruptions in the delivery of products to the terminals of Kernel, Risoil and Viterra.
“On the day of the shelling, Ukrzaliznytsia introduced a convention on freight transportation that was to be in effect until April 13, and then extended twice – first until April 17, then until April 22, after which it was lifted.
Ukraine in January-June this year reduced exports of titanium-containing ores and concentrate in physical terms by 96.1% compared to the same period last year – to 6.196 thousand tons.
According to statistics released by the State Customs Service (SCS) on Monday, in monetary terms, exports of titanium-containing ores and concentrate decreased by 82.9% to $10.386 million.
At the same time, the main exports were to Turkey (32.05% of supplies in monetary terms), Japan (30.91%) and India (9.35%).
Ukraine did not import these products during this period.
As reported, Ukraine in 2022 reduced exports of titanium-containing ores and concentrate in physical terms by 41.8% year-on-year to 322.143 thousand tons, in monetary terms by 19.6% to $130.144 million. The main exports were to the Czech Republic (47.91% of shipments in monetary terms), the United States (11.94%) and Romania (9.75%).
Ukraine in 2022 imported 196 tons of similar products from Senegal (70.41%) and Turkey (29.59%) for $115 thousand.
In Ukraine, titanium-containing ores are currently mined mainly by United Mining and Chemical Company PJSC (UMCC), which has taken over Volnogorsk Mining and Metallurgical Combine (VGMK, Dnepropetrovsk region) and Irshansk Mining and Processing Combine (IGOK, Zhytomyr region), as well as by Mezhdurechensky GOK LLC and Valki-Ilmenit LLC (both located in Irshansk, Zhytomyr region).
In addition, production and commercial firm “Velta” (Dnipro) built a mining and processing plant at Birzulovskoye deposit with a capacity of 240 thousand tons of ilmenite concentrate per year.
Agroholding KSG Agro has begun exporting sunflower oil to Poland and Italy, and the first batch of 2,000 tons of rapeseed has been sent to Slovakia, according to a press release from the agrarian group on Thursday.
“Currently, there are very good conditions for agricultural producers to export to the EU – in fact, there are no taxes (in particular, VAT) and import duties. So, if you solve problems with transportation, establish efficient logistics, you can have a good source of replenishment of foreign exchange income”, – quotes the agricultural holding of its owner Sergey Kasyanov.
According to him, the export of agricultural products to the EU makes it difficult to increase the cost of logistics and increase its time. So, if earlier one delivery to the EU was carried out on average in 5-7 days, then in the conditions of the Russian military invasion and queues at border crossings, delivery can last 20-30 days.
It is specified that the supply of sunflower oil to Poland and Italy will be carried out with the help of flexitanks – polymer containers designed for the transportation of liquid cargo on conventional trucks.
In addition to KSG Agro LLP, we are currently negotiating with partners regarding the possibility of bottling and refining sunflower oil in the EU countries in order to quickly increase its exports and sell products ready for consumption.
“We managed to build effective supply chains for export supplies of both grain and high value-added products (vegetable oil) to the markets of the EU countries, despite the blockade of seaports. In 2022-2023, we plan to focus on developing the export of our products in order to increase foreign exchange earnings. There are all the prerequisites for this, for example, high demand in the EU for grain and the same rapeseed,” Kasyanov summed up in the message.
The vertically integrated holding KSG Agro is engaged in pig breeding, as well as the production, storage, processing and sale of grains and oilseeds. Its land bank is about 21 thousand hectares.
According to the agricultural holding, he is in the top 5 pork producers in Ukraine.
In 2021, the holding increased its net profit by 16 times compared to 2020, to $20.27 million, revenue by 44%, to $30.75 million, while doubling EBITDA to $12.28 million.
The owner and chairman of the board of directors of KSG Agro is Sergey Kasyanov.
From June 30, Ukraine began exporting electricity to Romania at a capacity of 100 MW, Prime Minister of Ukraine Denys Shmygal announced.
“Today, from 1 a.m., such exports went towards Romania. The initial volume is 100 MW,” he wrote on his telegram channel on Thursday.
He noted that in the first day alone, the state-owned company Ukrenergo earned UAH 10 million by selling access to the interstate section for export, and potentially Ukraine could earn more than UAH 70 billion a year from this.
“The potential for the export of Ukrainian electricity to Europe is up to 2.5 GW. Under this scenario, the state will be able to receive more than UAH 70 billion a year,” Shmyhal said.
The prime minister stressed that the energy visa-free regime with the EU, which began in March this year, gives its very visible and practical result, and the energy sector will become one of the drivers for the recovery of the Ukrainian economy, as it has already become a driver for integration into the EU.
According to the data on the ENTSO-E website, physical exports from Ukraine to Romania are made on June 30 with a flat schedule of 100 MWh.
As reported, Ukrenergo earned more than UAH 10 million at the first auction for the sale of a section to Romania on June 30, and almost UAH 14 million at the second auction, on July 1. The section was divided respectively by 5 and 6 companies. A total of 8 and 10 companies participated in the auction, respectively.
Ukrainian and European energy systems have been operating synchronously since March 16. On June 27, Europe opened electricity exports from Ukraine, which was supposed to start on June 30.
In a few days, Ukraine will start exporting electricity to the synchronous zone of Continental Europe, Volodymyr Kudrytsky, Board Chairman of NPC Ukrenergo, has said on his Facebook page on Tuesday.
“ENTSO-E confirmed on June 27 that Ukrenergo, together with TSOs [Transmission System Operators] of neighboring countries, has successfully met six technical conditions for opening the first 100 MW of electricity exports from Ukraine to Europe. Ukraine can also import this amount of European electricity if necessary,” Kudrytsky wrote.
According to him, today Ukrenergo will hold an open auction for access to the interstate section, at which all electricity producers and other participants will be able to participate.
“This decision finally breaks the ‘aquarium’ of the closed Ukrainian energy market and at the same time brings us closer to full integration into the European energy space,” the head of Ukrenergo stressed.
He noted that in terms of the timing of the opening of exports from the power system newly attached to ENTSO-E, this is an unprecedentedly quick decision. Under the 2017 synchronization agreement, commercial exports from the Ukrainian power grid were to open only one year after the trial synchronization. Ukraine has reached an agreement to open commercial electricity exchanges in three months.
Kudrytsky also saw a certain symbolic coincidence in the date of the ENTSO-E decision on Ukrainian exports.
“Exactly five years ago, Ukrenergo signed the historic agreement with ENTSO-E, thanks to which the Ukrainian energy system is now synchronized with the European one. This agreement set the conditions for future integration with the continental European energy grid, which was to take place in 2023. We achieved the result a year and a half earlier,” the head of Ukrenergo summed up.
Andriy Gerus, Chairman of the Verkhovna Rada Committee on Energy, Housing and Utility Services, said at a press conference on Tuesday that Ukraine would start exporting electricity to the synchronous zone of Continental Europe from July 1.
At the same time, Minister of Energy Herman Haluschenko specified that the export of electricity would start on June 30.
The same information was posted on its website by ENTSO-E.
“The start of commercial electricity exchange with the Ukraine/Moldova power system is scheduled for June 30 at the Ukraine-Romania connection. It is expected that electricity trading on other connections [Ukraine-Slovakia, Ukraine-Hungary and Moldova-Romania] will start later,” the network said in a release on Tuesday.
According to him, the total trading capacity at the first stage will be set at 100 MW. After this initial phase, a gradual increase in trading capacity will be regularly assessed based on grid stability and security considerations, ENTSO-E explained.
Prime Minister Denis Shmygal says that by the end of the year Ukraine plans to expand the capabilities of Ukrainian energy companies, and will be able to export to the European Union about 800 MW of electricity per day.
“In mid-March, Ukraine joined the European network ENTSO-E ahead of schedule… Ukraine is already exporting its electricity to Europe,” Shmygal told a government meeting on Tuesday.
According to the Prime Minister, in April, electricity exports to Poland increased by 35% compared to pre-war January.
“By the end of the year, we plan to expand the capabilities of Ukrainian energy companies, and will be able to export to the EU about 800 MW of electricity per day. This will help Europe to abandon the consumption of Russian coal and reduce the consumption of Russian gas, “he said.
