Ukraine's grain exports have slowed sharply in recent weeks, with delays in shipments and concerns about the expiration date of the agreement with the United Nations (UN) for the disposal of food from the Black Sea.

"Few traders are willing to sell Ukrainian grain at the moment unless they have more transparency about the extent of the grain agreement," said Black Sea agricultural consulting director SovEcon, Andrey Sizov.

The treaty that defined the boarding hall is due to expire on March 19.

Russia's close-to-one invasion of Ukraine hurt shipments of wheat and sunflower oil initially, raising concerns that there was a global food crisis.

Exports only returned to pre-war levels at the end of last year after Russia and Ukraine joined a UN-backed pact to resume food exports from Black Sea ports.

In a report, the German bank Commerzbank pointed out that the Russian Foreign Ministry released a statement last Friday (17) criticizing the agreement and the fact that most of the grains exported by the humanitarian corridor so far have been sent to high-income countries, while shipments to poor countries have generally decreased. The note also noted that the Togliatti-Odessa ammonia pipeline was blocked by Kiev for political reasons.

Amid turbulence and fears that the talks will not be renews, the Ukrainian Mixed Coordination Center recorded a fall in shipped grain volumes from 3.7 million tons in December to 3 million tons in January.

As of February 20, about 1.5 million tonnes had been shipped, compared to 2.8 million tons scheduled. "One reason for this is the slower pace of inspections, which fell from nearly 11 ships a day in October to about 6 ships a day recently," Commerzbank said.

The Ukrainian Grain Association claims that Russia deliberately delays ship inspections to destabilize supplies. Last week, 140 vessels were awaiting inspection against less than 100 at the beginning of the year.

The founder of Black Sea agricultural market analysis firm UkrAgroConsult, Sergey Feofilov, said uncertainty compounded by delays in inspections caused exporters and traders to work with a three- to four-week planning schedule to leave the Black Sea instead of the previous one-week deadline.

Concern about failure to comply with already agreed export orders has also diminished the appeal of Ukrainian wheat to buyers from the Middle East and North Africa, analysts said.

By contrast, Russian grain exports reached near-record levels after a robust wheat harvest. According to Commerzbank, it is the Russian supply of cereal that has contained prices.

The exported volume of Russian wheat explains why grain prices barely responded to the risk of lower supply from Ukraine, according to the bank.

Source: Canal Rural