Canada Commits Cargo Vessels to Help Move Ukraine’s Wheat
culled from The Maritime Executive
* As India bans wheat exports over global scarcity
(TME)The government of Canada plans to help Ukraine export its stranded wheat to nations where it is in high demand, its foreign affairs minister announced on Monday.
Russia has blockaded Ukraine’s seaports, trapping dozens of foreign-flagged vessels and about 20 million tonnes of Ukrainian grain. That agricultural cargo – primarily wheat – is essential to food supplies in many developing nations, particularly in the Middle East and Africa.
With Ukraine’s Sea of Azov coast under Russian control and its Black Sea ports under seige, the options for getting its grain to export markets are limited. Its closest alternative is the Romanian port of Constanta, reachable by land transport and by inland barge; however, the potential volume is restricted by multiple bottlenecks. The EU has stepped up with the creation of “Solidarity Lanes” to speed cross-border transport of grain cargoes by road and rail, facilitating onward delivery to EU ports for export.
Canada is joining the effort, foreign minister Melanie Joly announced on Monday. “We are on this. We are in solution mode and it’s Canada’s contribution to making sure that we participate in this great mission of freeing the Ukrainian wheat,” Joly told Canadian media.
Canada plans to dispatch cargo ships to pick up Ukrainian wheat in Romania and other Black Sea states, then deliver the food where it is needed most – countries like Egypt and Lebanon, which get a substantial share of their sustenance from Ukraine’s wheat fields. Russia’s war has created a “potential food crisis,” Joly told Politico, and the West needs “to do more to show African countries, Latin American countries and Middle Eastern countries and Asian countries that we are there to share solutions.”
World Food Program director David Beasley has warned of an impending humanitarian disaster if Ukraine’s wheat remains stuck in storage. If the blockade is not lifted, there will be no silo space for the next harvest in July/August, raising the prospect of millions of tonnes of wasted grain. Meanwhile, WFP is already cutting food aid rations to desperate populations in Syria, Yemen and elsewhere because of the soaring cost (and reduced supply) of wheat.
“Right now, Ukraine’s grain silos are full. At the same time, 44 million people around the world are marching towards starvation. We have to open up these ports so that food can move in and out of Ukraine. The world demands it because hundreds of millions of people globally depend on these supplies,” Beasley said Friday. “We’re running out of time and the cost of inaction will be higher than anyone can imagine. I urge all parties involved to allow this food to get out of Ukraine to where it’s desperately needed so we can avert the looming threat of famine.”
Meanwhile, as prices soar in the international grain trade, India has issued a sudden ban on wheat exports in order to support stable domestic prices and supply levels.
A brutal heat wave is expected to take a toll on India’s grain production this year, cutting into the Indian government’s hopes to increase exports amidst a tight global market. India holds about 10 percent of the world’s stored grain reserves, and these tonnes are badly needed in the global market due to the loss of export volume from Ukraine. The Russian invasion has shuttered all Ukrainian seaports, leaving one of the world’s leading wheat exporters without a viable route to market for its crops. Between them, Russia and Ukraine supply about 30 percent of the world’s wheat and barley, according to the World Food Programme (WFP)
The Indian government signaled last month that it would open its granaries and sell wheat to the world, viewing it as an opportunity for farmers to capitalize on high international prices. However, the crushing heat wave that has hit the Indian subcontinent has raised fears of a bad harvest in 2022. Harish Damodaraan, a senior fellow at the Centre for Policy Research in Delhi, told CNBC that yields are expected to fall by 15-20 percent in the most affected regions.
In response, India’s Commerce Department announced Friday that it would ban all wheat exports that do not already have a letter of credit secured. It will allow limited exceptions for exports to nations with vulnerable food supplies.
According to Reuters, the sudden ban is creating significant challenges for India’s commodity traders, who may have to declare force majeure on planned shipments that do not already have a letter of credit attached. It is a stunning turnaround, since official government policy had encouraged farmers to export their crop right up until the day of the ban. Now, export-bound stocks that are trapped in storage will have to be resold on India’s domestic market, and likely at a lower price – helping to ensure an adequate food supply at a reduced rate of inflation for Indian consumers.
While it may benefit the Indian public in the near term, the decision threatens to further increase the price of wheat for developing nations like Syria and Yemen, which have already been hit hard by the shutdown of Ukraine’s grain terminals. Global wheat prices rose 20 percent in March, contributing to inflationary pressures that are forcing the World Food Programme to buy less and cut aid rations in war-torn and famine-stricken regions.
“The latest data from the International Food Policy Research Institute’s food trade policy tracker show that, since the Ukraine invasion, 23 countries have imposed export restrictions on food,” noted WFP chief economist Dr. Arif Husain in a bulletin issued Monday. “It is critical that WTO facilitates coordination between governments and encourages major countries holding reserves, such as China, India and the United States, to release grain stocks onto international markets.”
*Culled from The Maritime Executive.
(TME)The government of Canada plans to help Ukraine export its stranded wheat to nations where it is in high demand, its foreign affairs minister announced on Monday.
Russia has blockaded Ukraine’s seaports, trapping dozens of foreign-flagged vessels and about 20 million tonnes of Ukrainian grain. That agricultural cargo – primarily wheat – is essential to food supplies in many developing nations, particularly in the Middle East and Africa.
With Ukraine’s Sea of Azov coast under Russian control and its Black Sea ports under seige, the options for getting its grain to export markets are limited. Its closest alternative is the Romanian port of Constanta, reachable by land transport and by inland barge; however, the potential volume is restricted by multiple bottlenecks. The EU has stepped up with the creation of “Solidarity Lanes” to speed cross-border transport of grain cargoes by road and rail, facilitating onward delivery to EU ports for export.
Canada is joining the effort, foreign minister Melanie Joly announced on Monday. “We are on this. We are in solution mode and it’s Canada’s contribution to making sure that we participate in this great mission of freeing the Ukrainian wheat,” Joly told Canadian media.
Canada plans to dispatch cargo ships to pick up Ukrainian wheat in Romania and other Black Sea states, then deliver the food where it is needed most – countries like Egypt and Lebanon, which get a substantial share of their sustenance from Ukraine’s wheat fields. Russia’s war has created a “potential food crisis,” Joly told Politico, and the West needs “to do more to show African countries, Latin American countries and Middle Eastern countries and Asian countries that we are there to share solutions.”
World Food Program director David Beasley has warned of an impending humanitarian disaster if Ukraine’s wheat remains stuck in storage. If the blockade is not lifted, there will be no silo space for the next harvest in July/August, raising the prospect of millions of tonnes of wasted grain. Meanwhile, WFP is already cutting food aid rations to desperate populations in Syria, Yemen and elsewhere because of the soaring cost (and reduced supply) of wheat.
“Right now, Ukraine’s grain silos are full. At the same time, 44 million people around the world are marching towards starvation. We have to open up these ports so that food can move in and out of Ukraine. The world demands it because hundreds of millions of people globally depend on these supplies,” Beasley said Friday. “We’re running out of time and the cost of inaction will be higher than anyone can imagine. I urge all parties involved to allow this food to get out of Ukraine to where it’s desperately needed so we can avert the looming threat of famine.”
Meanwhile, as prices soar in the international grain trade, India has issued a sudden ban on wheat exports in order to support stable domestic prices and supply levels.
A brutal heat wave is expected to take a toll on India’s grain production this year, cutting into the Indian government’s hopes to increase exports amidst a tight global market. India holds about 10 percent of the world’s stored grain reserves, and these tonnes are badly needed in the global market due to the loss of export volume from Ukraine. The Russian invasion has shuttered all Ukrainian seaports, leaving one of the world’s leading wheat exporters without a viable route to market for its crops. Between them, Russia and Ukraine supply about 30 percent of the world’s wheat and barley, according to the World Food Programme (WFP)
The Indian government signaled last month that it would open its granaries and sell wheat to the world, viewing it as an opportunity for farmers to capitalize on high international prices. However, the crushing heat wave that has hit the Indian subcontinent has raised fears of a bad harvest in 2022. Harish Damodaraan, a senior fellow at the Centre for Policy Research in Delhi, told CNBC that yields are expected to fall by 15-20 percent in the most affected regions.
In response, India’s Commerce Department announced Friday that it would ban all wheat exports that do not already have a letter of credit secured. It will allow limited exceptions for exports to nations with vulnerable food supplies.
According to Reuters, the sudden ban is creating significant challenges for India’s commodity traders, who may have to declare force majeure on planned shipments that do not already have a letter of credit attached. It is a stunning turnaround, since official government policy had encouraged farmers to export their crop right up until the day of the ban. Now, export-bound stocks that are trapped in storage will have to be resold on India’s domestic market, and likely at a lower price – helping to ensure an adequate food supply at a reduced rate of inflation for Indian consumers.
While it may benefit the Indian public in the near term, the decision threatens to further increase the price of wheat for developing nations like Syria and Yemen, which have already been hit hard by the shutdown of Ukraine’s grain terminals. Global wheat prices rose 20 percent in March, contributing to inflationary pressures that are forcing the World Food Programme to buy less and cut aid rations in war-torn and famine-stricken regions.
“The latest data from the International Food Policy Research Institute’s food trade policy tracker show that, since the Ukraine invasion, 23 countries have imposed export restrictions on food,” noted WFP chief economist Dr. Arif Husain in a bulletin issued Monday. “It is critical that WTO facilitates coordination between governments and encourages major countries holding reserves, such as China, India and the United States, to release grain stocks onto international markets.”
*Culled from The Maritime Executive.
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