The grain cargo base may be halved next year

Due to a number of factors, the freight base for the transportation of grains may be significantly reduced next year.

In particular, the grain cargo base will decrease due to a 25% decrease in winter wheat sowing areas, lower yields due to a reduction in mineral fertilizer purchases to the level of 30–40% compared to last year, as well as due to an increase in the cost of logistics. The head of the Ukrainian Agrarian Business Club Roman Slastyon said this, writes Rail Insider.

“Questions in logistics. We see that it has now increased in value in Ukraine by 3 times to our ports, to European ports by 2 times. The fact that logistics eats up and earns an additional margin of 60-80 dollars per ton is a direct loss for the agricultural producer, if we take the current price somewhere around 120 dollars per ton of corn and wheat in the central region of Ukraine. The loss definitely does not stimulate sowing next year and, unfortunately, the base for transportation next year with this approach will automatically be reduced by a factor of 2”, Roman Slastyon noted, calling for a search for compromises and a balance of interests.

He also asked the UZ to increase the supply of grain trucks at auctions.

“The appeal to Ukrzaliznytsia is to start increasing the offer of auctions in order to balance the interests of all participants,” said the head of Ukrainian Agrarian Business Club.