IMPACT

Ukraine calls for unblocking of ports to prevent global food crisis

Kenya is a huge dependant of wheat imports from the country, and Russia.

In Summary

•Steps must be taken to unblock ports for wheat exports-Zelenskiy.

•Russia has mounted a blockade of Ukrainian ports.

Workers arrange bags of wheat in a godown at the Mombasa Port.
Workers arrange bags of wheat in a godown at the Mombasa Port.
Image: FILE

Ukraine's President has said trade at the country's ports was at a standstill and urged the international community to take immediate steps to end a Russian blockade to allow wheat shipments and prevent a global food crisis.

Volodymyr Zelenskiy made the comments after speaking to European Council President Charles Michel, who was visiting Odesa - the major Black Sea port for exporting agricultural products where missiles struck tourist sites and destroyed buildings on Monday. 

"For the first time in decades and decades, in Odesa there is no regular movement of the merchant fleet, there is no routine port work. This has probably never happened in Odesa since World War Two," Zelenskiy said in a video address.

"And this is a blow not only to Ukraine. Without our agricultural exports, dozens of countries in different parts of the world are already on the brink of food shortages. And over time, the situation can become, frankly, frightening."

Ukraine was the world's fourth-largest exporter of maize (corn) in the 2020/21 season and the No.6 wheat exporter, according to International Grains Council data. But nearly 25 million tonnes of grains are now stuck in Ukraine, a U.N. food agency official said on Friday.

"Immediate measures must be taken to unblock Ukrainian ports for wheat exports," Zelenskiy said earlier on his Telegram messaging channel.

He did not specify what measures he was seeking. NATO countries including the United States have ruled out armed intervention for fear of triggering a wider war.

Canadian Prime Minister Justin Trudeau, who visited Kyiv on Sunday, said his country would help Ukraine work out options on how to export stored grain.

SILOS OF BLOCKED GRAIN

Michel, who chairs summits of the European Union's national leaders, wrote on Twitter that he had seen silos full of grain, wheat and corn in Odesa that was ready for export but blocked.

"This badly needed food is stranded because of the Russian war and blockade of Black Sea ports. Causing dramatic consequences for vulnerable countries. We need a global response," he wrote.

Russia's blockade of Ukrainian ports since the invasion on Feb. 24 has added to volatility in international financial markets, sending commodity prices higher.

U.N. Secretary-General Antonio Guterres said last week the problem of food security cannot be solved without restoring Ukrainian production to the world market.

Ukrainian agriculture officials say the exportable surplus is around 12 million tonnes, and agriculture analysts have said Ukraine's stocks are so high that there will not be enough room to store the new harvest when it comes.

Ukraine has sown about 7 million hectares of spring crops this year, or 25-30% less than a year earlier, Agriculture Minister Mykola Solskyi said on Monday.

He said Ukraine had exported 1.090 million tonnes of grain in April, but that the sowing was not of the same quality as last year and the sowing area for corn was smaller.

Moscow says its "special operation" in Ukraine is designed to disarm and denazify its smaller neighbour. Ukraine and the West say this is a false pretext for an unprovoked war of aggression by Russia.

IMPACT ON KENYA

Kenya has traditionally relied heavily on wheat imports from Ukraine and Russia, with the war leading to price increases of wheat flour and products in the country.

More than 80 per cent of Kenya's wheat import is sourced from the two countries with other major sources being Argentina and the US.

Local production has failed to meet demand, with the country's annual consumption standing at an average 900,000 tonnes against a production of about 350,000 tonnes.

According to the Cereal Millers Association (CMA), Kenya is reliant on Russian and Ukrainian wheat entirely in the second half of the year.

Other source markets such as Argentina and Australia harvest in December.

“The war between Russia and Ukraine has already affected global prices. Kenya relies on both Ukraine and Russia as one of the key exporters for grain as they account for 33 per cent of global wheat supplies,” CMA chief executive Paloma Fernandes told the Star.

The country has since been forced to seek alternative markets with  India and Serbia among main target sources to cushion consumers against the high cost of wheat flour, and to avert the looming shortage.

Gerald Masila executive director, of Eastern Africa Grain Council (EAGC), said Kenya and the East African region are currently experiencing a wheat shortage because of the crisis in Russia and Ukraine.

Blockage of ports will make the situation even worse.

Prices have increased to over $580 dollars ( Sh67,291) per tonne of the wheat being offered in the world market, up from an average of $280 Sh32,485.

The weak shilling against the US Dollar has also made imports more expensive with the global supply chain affecting shipping trends, which has led t

o increased freight costs.

Last week, Kenya's National Treasury Cabinet Secretary Ukur Yatani warned of tougher days ahead.

He said the current high cost of living could worsen.

This, he said,  is mainly due to global factors such as the high oil prices and disruption in the global supply chain which has resulted in short-supply of commodities.

Yatani said the Russia-Ukraine war has greatly contributed to this situation.

The country’s inflation touched a high of 6.47 per cent from 5.56 per cent in March and 5.08 per cent in February.

“The situation might get even harder for us and the globe,” CS Yatani said during the release of the country's Economic Survey 2022, in Nairobi.

He said sanctions (on Russia) as a result of the war has affected movement of goods.

The recent poor rains in Kenya also affected food production with the dairy sector being hard hit, leading to a shortage of milk and an increase of up to Sh5 on the commodity’s retail prices.

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