Grain Is Starting To Ship From Ukrainian Ports But It Might Be Too Late For Starving Millions

For six months, ships filled with grain have been sitting idle in ports along the Black Sea, victims of Russia’s unprovoked attack on Ukraine. Now some of those ships are moving, navigating the perils of a war zone with cargo of sometimes sketchy quality.

“It only takes one missile to fly across the place and hit something, and then it all stops,” says John Rich, chairman of Ukrainian agriculture giant MHP, which has continued operations in the country even while many of its competitors left when war broke out. “There’s light in the tunnel with the ports. But the tunnel could close rapidly. It only takes one act, and that’s gone. It’s a high risk.”

The first shipments are making their way out of Ukraine towards destinations in the Middle East and Africa where millions have been struggling through a worsening hunger crisis. There are now pockets of starvation worsened by drought in many regions. In East Africa, for example, one person is likely dying from acute hunger every 48 seconds, according to a May report from Oxfam.

The shipments are crucial to combating hunger, but the grain may not be the solution it could be. As war broke out in February, crews abandoned their ships, many of which didn’t run for six months. That means many of them haven’t been ventilated. It’s likely that a lot of grain has grown mold or even mycotoxins from the humidity of the high seas.

That’s if the ships make it. The first ship to leave the port of Odessa, the Sierra Leone-flagged Razoni, is anchored in the Mediterranean Sea near Turkey, according to the government of Lebanon. Rich, whose company typically processes 3 million tons of Ukrainian grain annually, says the shipment is likely delayed due to the quality of the grain deteriorating and possibly having to be resold. Usually shipments are unloaded within two weeks. This one had been at port in Odessa for months.

“The grain quality is dubious, from what we hear,” says Rich. “The false start to all of this has been difficult.”

Even getting the shipments out of the ports is extremely difficult. Aside from the mines, the southern part of Ukraine is very much an active war zone. Ukrainians are in the midst of a counter-offensive to try to win back the port city of Mariupol, among other municipalities. The troops are facing heavy artillery from Russia.

That’s the other reason that MHP, which also processes chicken and crushes sunflowers for oil, is not rushing back to Odessa with tons of exports ready to ship.

“As a businessman, what can I do? I can sit and wait,” says Rich. “In MHP’s position, we don’t want to be a pioneer in this. We’re more likely to sit back and store our grain and see how the process goes.”

What’s leaving MHP warehouses is often heading to Europe via trucks or trains through Ukraine’s western border with the rest of Europe. Demand in wealthier European countries is strong after drought and other tough conditions have led to some crop failures.

Most of the Ukrainian grain hitting Europe had been intended for countries in the Middle East and Africa, like Egypt, where people have been struggling to buy enough grain. MHP has several 15-year-plus contracts in the Middle East and Africa, which Rich says MHP has not been able to fulfill.

Ukraine and Russia are responsible for exporting 30% of the world’s cereal grains and nearly 70% of its sunflower oil. They supply more than half the grain to 36 countries. Prior to the conflict, 98% of Ukraine’s grain exports were shipped via the Black Sea, which Russian ships blockaded starting in February.

The reopening of the ports, even temporarily as a United Nations-brokered deal lasts for 120 days, is a powerful symbol for the global hunger crisis, says Abiola Afolayan, a former UN official who’s now a senior international policy advisor for the anti-hunger organization Bread for the World.

This is a very delicate situation, Afolayan says. “There’s concern about getting the grain out safely,” she says. “The big issue has been attacks on ships and getting out of the port of Odessa. But this is just one of the key components of solving the global food crisis that we are faced with. It by no means must be the only avenue.”

Worldwide, the UN says that over the past few years, the number of people “marching to starvation” around the world has ballooned to 323 million from 80 million, with 49 million people in 43 countries at risk of famine.

MHP is in the last two weeks of its harvest and is expecting roughly half a million tons of wheat in all. There’s about 21 million tons of fresh wheat now across Ukraine, much of which will soon be ready to ship. That’s still roughly 50% under last year’s take.

There’s also still said to be roughly 25 million tons of grain still stuck in Ukrainian warehouses, from last year’s harvest, that needs to be sold and shipped soon or else it will also spoil. The warehouse space needs to be freed for winter storage of this year’s crop.

Another complication for MHP and its competitors trying to get grain out of Ukraine: Commodity futures prices are back to pre-war levels of $9 a bushel after hitting $14 a bushel in May. That means companies like MHP are no longer making more for the additional risk.

That has MHP acting more risk-averse, according to Rich. Could Russia continue targeting ships leaving Ukrainian ports in a perverse attempt to decrease the global wheat supply and thereby raise the price for Russian wheat, which is now getting exported, too? A trap like that is one possibility, says Rich. He cites it as another reason why he’s only reluctantly starting to plan MHP’s return to the port of Odessa. “They could increase the prices dramatically,” he says. “I am very, very cautious.”

The next two weeks, as farmers wrap up summer wheat harvests and more ships attempt the tense voyage out of the ports, will be critical for the hungry millions that rely on Ukraine’s food exports.

“If the Black Sea ports become more and more tenable for all of us, of course we will ship as much as we can,” Rich says. “We’ve had customers in the Middle East and Africa for 15 years or longer. We want to honor our original commitments. But I don’t know if we will be able to do that, given the logistical issues.”