Infrastructure belonging to two major agricultural traders was damaged in Russian attacks on one of Ukraine’s biggest crop-handling ports, adding to mounting losses in its agricultural sector.
Rocket fire at the Ukrainian port city of Mykolaiv damaged a terminal belonging to agricultural trader Viterra on Wednesday, and the site is on fire, a company spokesman said. bunge ltd. also said one of its facilities was hit and a city rescue squad was at the site.
The attacks come even as delegations from Turkey and Russia said they had held a “positive” meeting in Moscow on the exit of grain-laden ships from Ukraine, Turkish state agency Anadolu reported earlier. Mykolaiv normally accounts for around a quarter of the country’s grain shipments, and damage there could make it more difficult to restart maritime trade, which has been largely halted since the invasion.
“Even if a deal were reached today, the safe passage could take months,” Rabobank analysts said in an emailed note on Wednesday. “A return to normality for Ukrainian exports is currently not in sight.”
The Viterra terminal can export up to 1.5 million tonnes of vegetable oil per year, the company said on acquisition in 2020. A major player in grains and other agricultural products, Viterra is 50 % by the world’s largest commodity trader, Glencore Plc. .
Bunge did not specify which crops are handled by its Mykolayiv plant, but said the plant has been closed since the Feb. 24 invasion.
Black Sea clearance needed before Ukrainian grain can be shipped, insurers return
Bunge’s main grain terminal was acquired in 2011 and includes an oilseed processing plant, grain storage and export loading operations. Total storage capacity is around 150,000 tonnes at the port and transshipment capacity is around 3 million tonnes per year, mainly soybeans, sunflowers and wheat, according to the Elevatorist website.
Damage to infrastructure risks prolonging the loss of Ukraine’s agricultural supplies to world markets, which has accelerated global food inflation this year. Russian forces fired at least seven missiles which hit southern Mykolaiv on Wednesday, regional governor Vitaliy Kim said on Telegram. Chicago wheat prices rose 3.2% after the assault, before paring the gain to trade 2% higher.
Ukraine’s agricultural industry suffered $4.3 billion in damage to land, machinery and livestock due to the Russian invasion, estimates the Kyiv School of Economics. His government estimates that a fifth of grain silos have been damaged or lost in territory occupied by Russian forces, and stalled exports are leaving farmers short of storage with the harvest underway.
In recent months, another grain and fertilizer complex was hit at the port of Mykolaiv, a frozen chicken warehouse was bombed and an elevator complex was destroyed in the Luhansk region.
–With the help of Kateryna Choursina and Áine Quinn.
Photograph: Artillery shells in a field not far from the city of Mykolaiv, Ukraine, June 12. Photo credit: Genya Savilov/TSWT/Getty Images
Copyright 2022 Bloomberg.
Loss of profits Russia Agribusiness Ukraine
Interested in Agribusiness?
Receive automatic alerts for this topic.