UkrAgroConsult shows optimum ways to invest in the grain infrastructure

22.09.2017

Over the last decade, Ukraine has increased grain exports more than fourfold: from 10 to 42 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 42 MMT. Back in the previous marketing year 2015/16, when 38 MMT was shipped, inland logistics somehow managed these shipments. The rise in exports by just 10% along with restrictions imposed on truck transportation was the straw that broke the camelback.

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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