Shipowners avoid Ukrainian ports, cancel freight contracts after Russian attacks — ASAP Agri

Shipowners are increasingly refusing to call at Ukrainian ports following intensified Russian attacks on vessels in the Black Sea and port infrastructure in Odesa region, prompting freight contracts to be revised and some bookings to be cancelled, according to ASAP Agri.

Taras Panasiuk, co-owner and head of the freight division at Atria Brokers, said conditions for vessels operating to and from Ukrainian ports had deteriorated significantly.

"Today [July 15 – ed.], a large number of shipowners announced they would avoid Ukrainian ports. Existing bookings are being reviewed, while some shipowners have already started cancelling freight contracts," he said.

The situation has been further complicated by insurers temporarily suspending the issuance of new war-risk insurance policies for vessels and cargoes bound for Ukrainian ports. Insurance companies are currently reassessing premium levels to reflect the increased security risks.

The worsening security situation has also sharply reduced trading activity in Ukraine's CPT port market.

Nataliia Levkoniuk, head of the CPT desk at Atria Brokers, said most grain traders had suspended new purchases while reassessing their exposure to risk.

"According to our information, most traders have suspended new purchases and are reviewing their risk exposure. Others have already reduced bid prices for new-crop grain by UAH 300 per ton," she said.

Market participants are also reporting stronger demand for alternative export routes. According to Atria Brokers commodity broker Georges Medawar, offers for Romanian feed wheat for August shipment have risen to EUR 216 per ton FOB Constanta (around $247/t), compared with $228-229/t FOB Constanta a week earlier. Some Romanian sellers have temporarily withdrawn from the market while awaiting further developments.

Should disruptions to grain exports from both Ukraine and Russia persist, Romanian and Bulgarian grain is expected to become the main alternative supply source for buyers in the Black Sea region.

Earlier, Bohdan Kostetskyi, operating partner at Barva Invest, said the wave of Russian attacks on Ukrainian ports had effectively brought Ukraine's deep-water grain exports to a halt. Most major grain traders have suspended purchases on a CPT deep-water ports basis, while some export terminals have temporarily halted operations.