Anxiety increases for Ukraine's grain farmers as harvest begins
Oleksandr Chubuk's warehouse should be empty, awaiting the new harvest with his supply of winter wheat already shipped abroad. Instead, his storage bins in central Ukraine are piled high with grain he cannot ship because of the war with Russia.
The green spikes of wheat are already ripening. Soon, the horizon will look like the Ukrainian flag, a sea of gold beneath a blue sky. Chubuk expects to reap 500 tons, but for the first time in his 30 years as a farmer, he's uncertain about what to do with it.
“Hope is the only thing I have now,” he said.
The war has trapped about 22 million tons of grain inside Ukraine, according to President Volodymyr Zelenskyy, a growing crisis for the country known as the “breadbasket of Europe” for its exports of wheat, corn and sunflower oil.
Before Russia's invasion, Ukraine could export 6 million to 7 million tons of grain per month, but in June it shipped only 2.2 million tons, according to the Ukrainian Grain Association. Normally, it sends about 30% of its grain to Europe, 30% to North Africa and 40% to Asia, said Mykola Horbachov, head of the association.
With Russia's blockade of Ukraine's Black Sea ports, the fate of the upcoming harvest in Ukraine is in doubt. The U.N. Food and Agriculture Organization said the war is endangering food supplies for many developing nations and could worsen hunger for up to 181 million people.
Meanwhile, many farmers in Ukraine could go bankrupt. They are facing the most difficult situation since gaining independence in 1991, Horbachov said.
Turkish President Recep Tayyip Erdogan has said his country is working with the U.N., Ukraine, and Russia to find a solution, offering safe corridors in the Black Sea for wheat shipments.
For now, Ukraine is trying less-effective alternatives to export its grain, at least to Europe. Currently, 30% of exports go via three Danube River ports in southwestern Ukraine.
The country also is trying to ship grain via 12 border crossings with European countries, but trucks must wait in line for days and Europe's infrastructure cannot yet absorb such a volume of grain, Horbachov said.
“It's impossible to build such infrastructure in one year,” he told The Associated Press.
Russia's invasion also caused transportation costs to soar. The price to deliver this year's harvested barley to the closest Romanian port, Constanta, is now $160 to $180 per ton, up from $40 to $45. And yet a farmer selling barley to a trader gets less than $100 per ton.
The losses are piling up, along with the harvest.
“Most of the farmers are running the risk of becoming bankrupt very soon. But they don't have any other option but to sell their grain cheaper than its cost,” Horbachov said.
On top of such challenges, not all farmers can sell their grain.
Before the invasion, Chubuk could sell a ton of wheat from his Kyiv region farm for $270. Now he can't find a buyer even at $135 per ton.
“The whole system backs up,” including storage options, said James Heneghan, senior vice president at Gro Intelligence, a global climate and agriculture data analytics company. The system was meant to keep Ukraine's exports flowing, not store them.
Without money coming in for grain, future harvests are challenging.
“Farmers need to purchase fertilizers, seeds, diesel, pay the salary,” Horbachov said. “Ukrainian farmers can't print money.”
The country hasn't yet run out of storage as the harvest begins.
Ukraine has about 65 million to 67 million tons of commercial grain storage capacity, according to Horbachov, although 20% of that is in Russian-occupied territories. Farmers themselves can store 20 million to 25 million tons.