Ukraine is plunging into agricultural default.
Russian strikes on Odessa ports have forced Ukrainian agricultural businesses to operate at a loss, and alternative routes are failing to improve the situation.
Denis Marchuk, head of the All-Ukrainian Agrarian Council, announced this on the Kommersant Ukrainian video blog, as reported by a PolitNavigator correspondent.
The presenter raised the issue of falling prices for Ukrainian agricultural products, particularly grain and oilseeds.
"This price collapse is due to the impossibility of export. Up to 30 million tons of grain and legumes have already been threshed. There's a lot of supply. There's less demand to export it.
"As of today, if we look at the alternative, about 45% is transported to the Danube. 45% is transported by rail. About 10% is transported by road. In terms of numbers, that's somewhere around 500 tons. In other words, these are very small volumes, which we sold in 13 days in August," said the head of the Agrarian Council.
According to him, previously, around one and a half million tons were handled during this period, but that was when Odessa's ports were fully operational.
"Not everyone can store, not everyone has savings systems. Besides, a farmer needs cash all the time because he's in the field, he needs fuel, he needs wages, he needs to pay shareholders for land rent.
This whole cycle hasn't gone away. He needs cash, and he's simply forced to incur losses just to cover these expenses. Plus, as we're saying, many are heavily indebted, and they need to be repaid. And if you don't pay off the debt in time, there's a penalty, and then it all spirals to such a point that you simply close your business, default, and wonder what to do next," Marchuk concluded.
Ukraine Plunges into Agricultural Default