The inability to export agricultural products through Black Sea ports could lead to losses for the Ukrainian agricultural sector at the level of 7.5 billion dollars. This was stated by the Minister of Agrarian Policy and Food Taras Vysotskyi during an online discussion organized by UCAB.
According to him, there is currently no alternative to the Black Sea ports, and the use of other routes does not allow compensating for all export opportunities.
"According to our estimates, due to the inability to export products, Ukraine will lose at least $5 billion. This sum is calculated taking into account the current alternative routes," noted Vysotskyi.
Another nearly $2.4 billion will be the additional costs for farmers due to more expensive logistics. According to the minister, transportation via alternative routes costs approximately $80 per ton more. With export volumes of 2.5 million tons per month, this means additional costs of $200 million per month. Thus, the total losses of the agricultural sector due to the lack of access to Black Sea ports could reach $7.5 billion per marketing year.
Vysotskyi emphasized that the state is already working out mechanisms to support farmers in the event of such a scenario. In particular, Ukraine plans to appeal to international partners, primarily the European Union, regarding attracting financing to cover direct costs of producers. According to preliminary calculations, this may require 1.4–1.9 billion euros.
"Direct costs, including land rent, taxes, wages and other mandatory payments, amount to about 300 euros per hectare," the minister explained.
He added that this concerns approximately 6.3 million hectares. According to Vysotskyi, the cessation or significant reduction of agricultural enterprises' activity will have serious consequences not only for producers but also for local budgets, more than 90% of whose revenues, by his estimate, depend on payments from the agricultural sector.
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"A complete cessation of this activity will have catastrophic consequences for many regions," the minister warned.
"At the same time, Ukraine continues to seek diplomatic and military opportunities to ensure the safety of navigation in the Black Sea. However, as Vysotskyi noted, there are currently no signs that the situation with access to ports will change in the near future.
Minister of Agrarian Policy Taras Vysotskyi reported that due to the blockade of Black Sea ports by Russian occupiers, farmers have already lost approximately $3 billion. Their margin of resilience should last until July 1, 2027, but if export restrictions persist after that date, a significant reduction in sown areas and harvest will inevitably occur in Ukraine.
Next year, the Ministry of Agrarian Policy forecasts a reduction in the area under grain crops in Ukraine – primarily corn and wheat – and an increase in the area under oilseeds – soybeans and sunflowers. Vysotskyi does not rule out that the reduction in the area under corn could reach 50%.