The attacks on Ukraine’s port infrastructure harbour consequences for countries that depend on Ukrainian agricultural products, but also producers at home.
The Ukrainian agricultural sector suffers significant losses after each attack by the enemy, with grain exports to Asia, Africa, and Europe decreasing by almost 3 million tons per month and Ukraine losing 40% of its port export potential. It will take at least a year and millions of dollars to rebuild the infrastructure in some regions. The survival of agricultural enterprises is the number one issue for Ukraine, as it is a direct aid to the Ukrainian economy, taxes for the state budget, jobs for the population, and an opportunity to buy weapons to defeat the enemy.
The Ukrainian agricultural sector is in a critical financial situation in 2023, with direct losses of the agricultural sector by the end of 2023 amounting to more than $3 billion, and most enterprises going bankrupt. The main reasons for this situation are the blockade of the Black Sea and expensive logistics. The rise in the cost of fuel, agrochemicals, and spare parts has led to higher production costs amid lower purchase prices.
According to farmers from the Ukrainian Agri Council (UAC), the agricultural sector is unprofitable for the first time in 20 years, with sunflower production never being unprofitable. The average Ukrainian will have enough food, but the issue of exports will become even more acute, and there will be no foreign exchange earnings in Ukraine.
