According to Vladimir Petrichenko, head of the analytical company ProZerno, Russia’s anticipated grain harvest of approximately 140 million tons includes plans to export 59 million tons. However, ongoing disruptions at southern ports may limit exports to only 39 million tons.
“This is not a problem; this is a catastrophe. This is the very catastrophe we are heading toward. We will see everything by January, as everything will accumulate,” Petrichenko stated.
Operations at the Azov Sea ports halted in early July, and following strikes on Novorossiysk in August, Black Sea terminals became paralyzed. Alternative routes via the Baltic Sea and the Arctic Ocean manage to handle only one-tenth of previous export volumes through southern ports.
The excess grain has led to prices in southern Russia plummeting by half, down to 4,000 to 5,000 rubles per ton (approximately $48 to $60). Farmers are compelled to sell their harvest at a loss.
ProZerno forecasts that by the end of the year, Russia may accumulate up to 34.8 million tons of grain. Under a pessimistic scenario, the agricultural sector could face a wave of bankruptcies.
Context
- On September 21, Bloomberg reported that attacks in the Black Sea have disrupted grain exports from Ukraine and Russia, which account for 25% of global wheat trade. Russia blocks Ukrainian ports with missile strikes and drone attacks but also struggles to export grain through the Black Sea due to threats from Ukrainian drones. The agency compared the significance of the Black Sea for global wheat trade to that of the Strait of Hormuz for the oil market.
