Thousands of freight cars stranded on Ukraine’s border during war with exports


LVIV, Ukraine, April 7 (Reuters) – In western Ukraine, some 1,100 trains carrying grain stuck near Poland’s main railway station are unable to transport their cargo abroad.

These are just a few of the 24,190 wagons transporting various products for export, including vegetable oil, iron ore, metals, chemicals and coal, which have been waiting to cross the western border of Ukraine since Tuesday, according to information from the state-run railway company. has not been previously reported.

As war rages along the south coast of the country, and its main ports are closed due to Russian invasion, Ukraine is struggling to export its grain and other goods, according to government officials and insiders. But as Kyiv seeks other land exports, its efforts have been hampered by organizational challenges and bureaucracy, say industry officials and commodity dealers.

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Valerii Tkachov, Deputy Director of Commerce at the state-owned railway company Ukrzaliznytsia, said 10,320 carriages – or about half of them – were waiting at the junction near the village of Izov, Poland’s main railway border post. The intersection, located about 130 kilometers north of Lviv, serves as a gateway to the Polish port city of Gdansk.

One key point: the large amount of goods that need to be found another way, which causes a shortage of everything from trains to staff, according to insiders in the business community and the government. Ukraine, one of the world’s largest grain exporters, had exported 98% of its grain across the Black Sea before the war. Usually, only a fraction of the country’s exports went by rail, as transportation costs are higher than shipping.

These difficulties are compounded by transportation issues, such as the difference between railway meters used in Ukraine and neighboring countries such as Poland – a legacy from when Ukraine was part of the Soviet Union. Although the western part of the country has been spared the worst of the conflict, there have been rocket attacks near Lviv, including on oil facilities, and security at the border is very high.

Ukraine’s export disruption means that countries that rely on Ukrainian grain imports – including China, Egypt, Turkey and Indonesia – will have to find other supplies or face food shortages, aid agencies have warned.

Russia’s invasion of Ukraine on February 24 has raised concerns about global food security and the rise in grain, fertilizer and fuel prices worldwide. Global food prices have been rising since mid-2020 due to planting and crop disruptions in many countries during the first year of the COVID-19 pandemic and later due to supply chain problems.

Even as Russia slows down operations around Kyiv and northern Chernihiv to focus on fighting in the east, the long-standing barrier to ports in southern Ukraine is a major setback. Cereal exports are the cornerstone of Ukraine’s economy – a total of about 12.2 billion dollars in 2021 and account for one-fifth of the country’s total exports, according to official data.

The Ukrainian government did not respond to a request for comment. Ukraine has said that last month’s grain exports fell to a tenth of the figure in March 2021 following the closure of ports and that the disruption is affecting people in many countries. “Hundreds of millions of people around the world will not receive food unless Russia’s closure of Ukrainian ports is lifted in the near future,” the Ministry of Agriculture said in a statement on April 1.

Russia launched what it calls a “special military operation” in Ukraine with the aim of disarming and “de-liberating” Ukraine. Ukraine and the West say the invasion was illegal and unjust.

The Kremlin did not respond to a request for comment. Russia has refused to deliberately target civilians and civilian infrastructure, despite documented attacks on hospitals, apartment buildings and railways.

Ukrainian farmers – who produced a record crop last year – say their wheat crop could be halved and perhaps more. Russian troops have repeatedly damaged grain stores in eastern Ukraine, a US official said. Kiev and Moscow have accused each other of laying mines in the Black Sea creating a danger to merchant shipping. Read more

The war has upset the country’s agricultural sector and “has destroyed roads, railways and railway stations in Ukraine that facilitate land transport,” a US official told Reuters last week. “As Putin’s war continues, more and more arable Ukrainian land is being destroyed by Russian tanks, shells and mines – which are in danger of a much longer food crisis.

Ukraine and Russia are the main exporters of wheat, accounting for about a third of the world’s exports – almost all of which pass through the Black Sea. Its waters share Bulgaria, Romania, Georgia and Turkey, as well as Ukraine and Russia, which have been at war since President Vladimir Putin invaded his neighbors on February 24.

SUPPORTED

It may take a long time to clean the residue.

Because the Ukrainian railway system uses a Russian scale measuring about 1.5 meters, or about 10 centimeters more than the rails used in most of Europe, railway workers have to lift wagons with a jack and manually replace the chassis to fit the Polish rails , said Tkachov. . Alternatively, they can remove the grain from the Ukrainian wagons and pour it into the Polish – a process that can take up to half an hour per wagon.

Tkachov, from the state railway, told Reuters that there are now up to 500 carriages crossing the border near Izov a day – in fact a three-week discount. He added that there were about two dozen cross-stations, many of which are not supported.

The state railway is working to increase the capacity of 1,100 grain wagons a day that travel to Poland, Romania, Hungary and Slovakia within three months – almost tenfold since March, he said.

It is hiring more people and buying equipment to help replace railroads, divert staff from passenger trains to freight, and also work to alleviate other barriers, such as customs clearance, Tkachov said.

“We are working to speed up the process … to reduce the number and length of wagon inspections and paperwork,” he said.

STOPPED FOR EXPORT

One company that has been affected by the following is Astarta Holding NV, a food producer based in Ukraine. The company had agreed to deliver 25,000 tonnes of maize to European customers in April, but had not yet received the required statement from the railway authorities, according to Julia Bereshchenko, director of investor relations and business development at Astarta.

Astarta also said it had about 150,000 tonnes of grain, mostly maize, sitting idle in its silos. At this time of year, the high storage facilities should be almost empty, he said.

Official figures released by the government on Sunday cited exports of 1.4 million tonnes of maize and wheat in March. That was about a quarter of the figure in February and decreased from about 3 million tons in March 2021.

But last month’s export volume includes grain loaded on ships stranded in Ukraine’s closed ports, Deputy Agriculture Minister Taras Vysotskiy told Reuters.

Vysotskiy said in an interview with Ukrainian state television on Monday that only 300,000 tons of agricultural products had left the country by rail.

Experts have said that Ukraine, which had exported 43 million tonnes of grain from the beginning of the season in July until the invasion at the end of February, could only export about 1 million tonnes over the next three months, due to transport difficulties. Before the war, the government predicted that grain exports could reach 65 million tonnes this season.

Vysotskiy said in a statement to television on Monday that Ukraine could potentially export 1.5 million tonnes a month by rail, adding that it was only a third of the amount normally handled by the ports but would still create much-needed income for the agricultural sector.

‘DROP INTO THE SEA’

Merchants, such as Cargill Inc., are looking for ways to bring food out of the country, but there is no easy solution, said an industry source.

Cargill did not respond to requests for comment.

Kyiv is in talks with Romania to transport its agricultural products through the Black Sea port of Constanta in Romania, the Ministry of Agriculture said on March 30. It would involve transporting the grain by rail to the ports of the Danube and then loading it onto a barge for sailing towards Constanta, industry officials said.

Once in the Romanian port, the grain would have to be transported to large ships for shipment around the world – making the whole process complicated and costly. According to APK-Inform, a Ukrainian agricultural consulting company, the cost of delivering Ukrainian grain to the Romanian port of Constanta was 120-150 euros ($ 133- $ 166) per tonne.

Prior to the war, traders paid $ 20 to $ 40 per tonne for transporting grain to Ukrainian Black Sea ports.

All hopes of a quick opening on that route were dashed this weekend. On Sunday, Russian missiles attacked the port of Mykolaiv and also attacked oil facilities near the main center of Odesa on the Black Sea, according to local officials. Russia’s Defense Ministry said its missiles had destroyed an oil refinery and three fuel depots near Odesa. It said they had been used by Ukraine to provide troops near Mykolaiv.

The Ukrainian government also says it is worried about the country’s own food supplies, even though it says it has enough supplies for three years.

Last month, Ukraine stopped the export of rye, oats, millet, buckwheat, salt, sugar, meat and livestock from the invasion and introduced an export license for wheat. The government, however, said it would allow free export of corn and sunflower oil.

“The director of one of the country’s main foreign commodity stores said that even if the country managed to increase its export capacity of agricultural products to 700,000 tonnes a month to 1 million tonnes a month by rail and via the Danube, it would be a drop in the ocean.”

“We could achieve 10-15% of the capacity that is really needed,” he said. “I think the risk to the economy is enormous.

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Reports by Silvia Aloisi and Pavel Polityuk in Lviv, Ukraine, additional reports by Maria Starkova in Lviv, Michael Hogan in Hamburg, Gus Trompiz in Paris and Steve Holland in Washington. Editing by Cassell Bryan-Low

Our Standards: Thomson Reuters Trust Principles.

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