Ukrainian farmers are reducing their planting for the coming season because millions of tons of grain remain trapped in storage, unable to reach international markets. The blockage, driven by intensified Russian drone and missile attacks on Black Sea targets, has made it impossible to insure commercial ships. While these strikes prevent Ukraine from exporting, Kyiv's retaliatory attacks have similarly stalled Russian exports, squeezing global supply. As fatal attacks continue into October, prospects for a ceasefire appear slim, even as Turkey works to broker a deal to protect global food security.
Oleksandr Chumak, a farmer in the Odesa region, reports that roughly 80% of his grain cannot be sold at a profit. With cash running out, he is scaling back next year's planting, avoiding corn and barley entirely in favor of crops that require less fertilizer. This strategy reflects a broader shift among producers who are moving away from logistically dependent grains toward oilseeds and niche crops. Andrii Dykun, chairman of the Ukrainian Agri Council, noted that farmers can currently only sell rapeseed and sunflower seeds, and even those volumes are insufficient to cover taxes and land rent.
The financial strain is visible in lending data. PrivatBank, Ukraine's largest lender, disbursed 1.53 billion hryvnia ($34.2 million) in working capital to agribusinesses between June and August, more than double the amount lent in the same period last year. Yevhen Zaihraiev, a chief corporate officer at the state-owned bank, explained that funds are tied up in inventories while farms struggle to cover operating expenses. Some producers are selling crops early at lower prices to maintain liquidity, while others with storage capacity are delaying sales in hopes of better market conditions.
Despite the current blockage, Ukrainian production of grains and oilseeds is forecast to rise to 85 million tonnes from 80 million tonnes this year. However, carry-over stocks are pressuring storage infrastructure, including plastic silobags and metal elevators that are increasingly vulnerable to military strikes. Since Russia's full-scale assault began in early 2022, the sector has faced takeovers, mines, and labor shortages. International efforts to preserve export routes, such as the collapsed Black Sea initiative and the EU's "Solidarity Lanes," have struggled to keep up with the deteriorating situation.
The global impact is significant because Ukraine and Russia supplied more than half of the world's sunflower oil, nearly a fifth of its barley, and 14% of its wheat before the war. Ukraine is also a major corn grower for buyers like China and the European Union. Typically, about 90% of Ukraine's agricultural exports move via the Black Sea, but August exports totaled only 981,000 tonnes, down roughly 58% from the previous year. This decline coincides with weaker corn crops in Europe and the United States, increasing demand for imports.
Benoit Fayaud, a senior manager at Expana, warned that reopening Black Sea ports would unleash a wave of cheap supply that could rapidly lower global grain prices by several dozen dollars. Currently, low domestic prices have intensified efforts to find alternative routes via rail, road, and river. However, these options are slow and difficult. Neighboring countries like Poland and Romania are resisting transit due to fears of a glut destroying demand for their own crops. The Danube route is hampered by low water levels and a damaged bridge, while routes through the Baltic states or Georgia can only cover a small portion of typical flows. Dykun emphasized that without Black Sea ports, selling grain via border crossings to the EU is not profitable enough to sustain Ukrainian agriculture.