Ukrainian grain exporters seek alternative routes amid rising maritime costs

Grain trade in the Black Sea region is facing significant challenges due to attacks on merchant vessels and rising maritime transport risks. Exporters are increasingly seeking alternative routes to reach global markets, with Romania emerging as a vital transit hub.

Insurance costs for ships in the Black Sea have increased fivefold, with war risk premiums rising from approximately 0.1% to 0.5% of a vessel's value. For a ship valued at $1.5 million, this represents an insurance cost increase from $1,500 to $7,500. Such rising expenses impact the competitiveness of wheat and corn exporters who operate on thin margins.

To mitigate these risks, Ukraine is expanding rail and river transport through Romania. Agreements have been made to increase daily rail shipments to the port of Constanta from six to ten pairs of trains. Additionally, efforts are underway to increase capacity in the Sulina Canal to facilitate more frequent vessel movement between the Danube and the Black Sea.