Nearly six weeks into the war in Ukraine, merchant ships in the Black Sea have run aground, halting the import and export of vital commodities, a situation that could have wide-ranging repercussions for the global economy.
With the Black Sea blocked by Russia and Ukraine placing mines around its ports, merchant ships cannot enter or leave, leaving the sailors on board stuck in a war zone.
Merchant ship Azburg, arrived at the port of the Ukrainian city of Mariupol on February 23. The next day, Russia invaded Ukraine. The ship sank on Tuesday after being hit by a Russian missile, according to Reuters. A senior defense official said the ship was hit by a Russian missile. The sinking of the ship highlights two secondary crises unfolding as the Russian invasion continues.
Ukrainian ports are closed. Ships cannot enter and they cannot exit. As the war lasts more than 40 days, Ukraine, a breadbasket in Eastern Europe, is unable to export wheat and other grains to countries in the Middle East and North Africa .
With ports closed, people aboard merchant ships are stranded, either because they weren’t allowed to leave their ships or because they’re strangers in a war zone, USNI News told Sal Mercogliano, maritime historian at Campbell University.
The Dominica ship is at least the second merchant ship to fall victim to the Russian invasion of Ukraine.
Rusen Mete, a freighter, was reportedly at the Port of Berdyansk, tweeted USNI News contributor HI Sutton. Ship spotters reported on March 29 that the ship caught fire, the victim of a fire that broke out on a Russian warship on March 24.
Merchant ship which caught fire when the #Russian Navy landing ship exploded in #Berdyansk identified as RUSEN METE. Would have burned.
Sierra Leone flag but possibly Turkish property.
High-resolution satellite imagery of it on fire, March 25, by @Maxar pic.twitter.com/lSNMYKYIP8
— HI Sutton (@CovertShores) March 29, 2022
Two sailors have been killed and five other merchant ships have been hit by missiles since the start of the war, Reuters reported.
There are about 1,000 sailors from the crews of small and large ships that need to be extracted, Mercogliano said. Some are not yet allowed to leave their ships. Others who have been told to abandon ship must now cross into other countries.
The International Maritime Organization is tracking 86 ships stranded in the Black Sea, according to the Reuters report.
This can be difficult as they are all foreign nationals.
“But again, they have to be allowed to cross the borders, because they’re not Ukrainians crossing,” Mercogliano said. “It would be Filipinos, Indians, Indonesians, Chinese and potentially Russians too, because Russia is 10% of the world’s ocean fleet members.”
And with ships unable to leave ports, Ukraine is unable to export its wheat supply to dependent countries, opening up the possibility of food shortages.
“It’s a big deal,” Mercogliano said. “We talked about the issue of potential food shortages because Ukraine is responsible for 10% of world grain exports, and that’s a combination of wheat, corn, barley and everything else. Other countries will either have to take over, but it will be very difficult to do. And then you will have to ask the expedition to move to do it.
The high percentage of grain exports is the reason Ukraine’s flag is half yellow, Mercogliano noted.
It supplies wheat to countries in the Middle East, Africa, Europe and Asia. In 2020, Ukraine was the fifth-largest wheat exporter, with $4.16 billion in exports, according to the Economic Complexity Observatory.
Egypt, Indonesia, Pakistan, Bangladesh and Lebanon were the top five importers of Ukrainian wheat in 2020, according to the OEC.
Several issues have impeded the export of wheat since the Russian invasion, said Johanna Mendelson Forman, adjunct professor at American University.
First, it is unclear whether Ukraine was able to sow its wheat during the sowing season, she said.
While most of the fighting has been in southern and central Ukraine, as Russia aimed to take population centers like Mariupol and Kyiv, wheat is growing in the western part of the country, he said. she stated. So, although the field may be intact, planters may not be available because Ukrainians have joined the country’s army or left the country.
Then there’s the matter of soil fertilization, Forman said. Ukraine generally gets its fertilizers from Russia and Belarus.
Even if the wheat was planted, it would have to be harvested, which requires big machinery that needs diesel, she said. Another product unavailable.
As for ports, Ukraine has no way to export the grain, even if it could be harvested, Mercogliano said.
The majority of Ukrainian wheat is exported via Odessa, the port of Pivdennyi, Mykolayiv and Chornomorsk, Niels Graham wrote for the Atlantic Council. If a port were available, insurance for the trip would be too expensive, he writes.
Russia is currently blocking the Black Sea, preventing Ukraine from using its ports, he said. Ukraine mined the beaches to prevent Russian troops from making an amphibious landing.
These mines were swept into the waters, making the sea dangerous for ships, Mercogliano said.
If wheat was not exported from Ukraine, the world could witness a potential “food collapse”, Forman said.
Food supplies can be substituted or sourced from different sources when a dispenser is unavailable, she said. But in the case of Ukraine, there was not enough time to plan for the wheat shortage, partly because there was a sense of denial that Russia would go through with its invasion.
This means the market must now identify where the stocks are and where the wheat may come from, she said.
“That’s a lot of wheat to replace,” Forman said.
This problem is only compounded by the ongoing COVID-19 pandemic, which has affected supply chains, and climate change, she said. Argentina, which is a major supplier of wheat, is struggling to export its wheat due to a drought. China, another major supplier, said it had its worst winter wheat on record due to heavy rains, according to the Graham’s Atlantic Council report.
Russia is also a major supplier of wheat, accounting for about a third of exports when combined with Ukraine, according to the Atlantic Council. Countries and companies are sanctioning Russia for the invasion, making it nearly impossible to access this wheat.
The sanctions also increase insurance costs for Russian shipping, making it too expensive to export wheat from Russia, according to the Atlantic Council. When there is a food shortage, prices rise, which can lead to violence, Forman said.
“There is a potential for great destabilization in weak countries that don’t have good safety nets,” Forman said. “That’s clear. And when you have so many countries in Africa, just living on the edge, in many cases, of lower middle income status, that can have a devastating effect on the economy.
There are other countries that can help ease some of the burden, including the United States, which likely has grain stocks, Forman said. Nobody wants to see the destabilization of a country like Egypt, she said.
For Ukraine, once the growing season is over, it is lost. Farmers in the country will have to wait until the next season to start farming, if they are able to start in the next season. It’s unclear what longer effects the Russian invasion will have on wheat production, Forman said.
There are “many variables… how badly the land is damaged, what kind of munitions have been in the ground, if they have the manpower, how many people they have lost,” she said. declared. “We have 4 billion people who have migrated. These are mostly women and children, but you still need a workforce. And Ukraine is also losing soldiers. So what happens to this generation?