Nibulon: Russian attacks on ports increase logistics costs and grain purchase prices

Russian attacks on the port infrastructure of the Odesa region increase the cost of logistics and affect the purchase prices of grain.

This was stated by Serhiy Kalkutin, Logistics Director of Nibulon LLC, in a comment to Interfax-Ukraine.

“The increase in freight rates and the growth in transportation costs are ultimately reflected in the purchase price of grain, and therefore in the profitability of agricultural production. In fact, these additional costs fall on the shoulders of the farmer, because logistics is one of the key components of the export cost,” he commented.

Kalkutin said that Nibulon has built a logistics model in such a way as to minimize the impact of security risks. Currently, the agricultural holding uses a diversified export system with alternative routes – this allows it to quickly redistribute cargo flows and maintain continuity of supplies.

“We continue to actively purchase grain through our own network of elevators and offer agricultural producers flexible models of cooperation: selling products at current market prices or storing them with the possibility of selling the grain later, when market conditions are more favorable,” Kalkutin added.

He explained that such flexibility is one of the key tools to support agricultural producers in conditions of high market volatility.

USM previously reported that Nibulon has signed a long-term contract for international transportation on the Danube.