Inland grain logistics. Ways of widening the bottleneck

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Inland grain logistics. Ways of widening the bottleneck

  • Railroads? Trucks? River transport? What will solve the grain-shipping problem?
  • How can the degree of the export grain flow’s freedom be increased?
  • Is it possible to avoid the risk of contract breach caused by a grain carrier shortage?

Over the last decade, Ukraine has increased grain exports more than fourfold: from 10 to 45 MMT. Growth of grain yields contributed to a rise in Ukraine’s grain export potential. In turn, this drove an expansion of port capacities. However, a weak link has appeared between the powerful production resource and the rapidly growing port sector: this is inland logistics.

The problem of grain movement between the grower and the export hub became particularly acute in the record 2016/17 season, when grain exports came close to 45 MMT. The problem remains persistently acute this season despite the decrease in export potential.

Logistics problems have entailed a series of negative consequences for the Ukrainian export market: contract execution delays, substantial growth of shipping costs, forced change of the commodity’s origin into NON-Ukrainian one, and many other issues.

To avoid further losses, major exporting companies are considering the possibility of investing in inland logistics. UkrAgroConsult’s study “Inland grain logistics. Ways of widening the bottleneck” shows optimum ways to invest in the grain infrastructure for reducing risks while executing export contracts.


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