One Million Tons Russian Agri-exports Delayed By Sea Freeze

One Million Tons Russian Agri-exports Delayed By Sea Freeze

Russian exports, of around 1 million metric tons of agricultural commodities, primarily grains such as wheat, have been delayed in the past month because freezing temperatures at ports in the south have prevented ships from reaching berths, shipping executives and traders said.

Some ships already loaded with grains are also unable to leave for their destinations, they said.

“The figure includes the grain stuck in both shipping vessels which are already loaded and the volume lying in the port warehouses,” Talibov Said, president of South Sea Port near Azov, said on the sidelines of an international grains conference here.

Russia is one of the world’s largest exporter of grains and oilseeds, and almost all its shipments take place from the southern ports. The delay in exports is one of the reasons for firming up of global prices in recent months.

Usually parts of rivers are frozen for a while in winter but it is unusual for Azov Sea waters near southern ports to turn into ice, said a Moscow-based cargo surveyor.

The smaller ports around Azov cater to importers in Turkey, Israel, the Middle East and European Union with cargoes of up to 5,000 tons each. The South Sea Port alone handles cargoes of around 50,000 tons monthly, at present mostly wheat.

Many ships are unable to reach berths, and exporters are resorting to force majeure, said Karina Nor-Arevian, head of South Sea Port’s legal department.

The weather is expected to improve only after mid-March, when the usual grain-loading operations can resume, Nor-Arevian said. There are at least six ports in and around the city of Azov in southern Russia’s Rostov district, with a total annual cargo handling capacity of close to 5 million metric tons, where operations have gone off-gear, she said.

Cargo surveyors said four ice-breakers are performing the steering operations of the vessels from Azov, Rostov, Taganrog and Yeisk ports, where the backlog is unlikely to be cleared before April.

In the past nearly eight months, Russia has exported close to 20 million tons of grains, at a monthly average of almost 2.5 million tons, but shipments are unlikely to be more than 5 million tons in the rest of the marketing year that ends June 30, or a tad above 1 million tons a month, Arkadiy Zlochevsky, president of the Russian Grain Union said.

The weather isn’t quite favorable for exports but a slowdown is natural during this time of the year, Zlochevsky said.

The supply disruption is temporary, the grain is still there and the backlog will be cleared eventually, Jay O’Neil, senior agricultural economist with Kansas State University said.

The Black Sea is open and deep sea ports of Tuapse and Novorossiysk are operational though there were delays earlier this month, the Moscow-based cargo surveyor said.