The grain producers of Moldova have to export merchandise at derisory prices owing to the war in Ukraine. At the same time, as the vessels and boats by which grain is transported abroad are not enough in number, ship owners increased the transportation costs 3-5 times, the president of the Association of Grain Producers and Exporters “Agrocereale” Igor Grigoriev has told IPN.
“The war in Ukraine directly affected the entire economy of the Republic of Moldova, but primarily the agrifood sector that was tied to Ukraine’s ports and grain market. As the ports in Odessa were blocked, Ukraine remained with millions of tonnes of wheat, corn, sunflower and soybean in stores. Such type of merchandise started to be exported via the Republic of Moldova,” explained Igor Grigoriev.
He noted that in general, together with the start of the war in Ukraine, the logistics chain for the export of grain was disrupted. Earlier, the transportation of a tonne of grain from Reni to Constanta cost €30, but the price now rose to over €100. Moreover, the naval authorities of Ukraine, the Republic of Moldova and Romania weren’t prepared to deal with so many ships. The capacities to export through the Danube Delta and along the Danube are much lower. The Danube is reached through the Sulina channel of Romania. Over 100 ships loaded with Moldovan and Ukrainian grain are queuing up there at present.
Moldova’s grain sector was seriously affected by the existence of larger grain supplies in Ukraine as the export prices of all types of grain decreased almost twice. The Ukrainians are selling last year’s grain stores at derisory prices so as to get rid of them. The Moldovan farmers planned to sell the wheat at the price of 6-7 lei per kilogram, but can now sell it for almost 4 lei. But diesel fuel rose in price two times and all the inputs, including mineral fertilizers, are now 2-3 times more expensive. Furthermore, the grain harvest this year has been affected by drought and the situation is rather difficult.
Grain exports almost stopped. “But we are hopeful the situation on the grain market will change in the near future and the prices will grow slightly and we will manage to sell grain and to also ensure the food security of the Republic of Moldova,” stated Igor Grigoriev.
He noted that support from the strategic partners is needed so that the eventual losses in the agrifood sector are covered. “Even if the agriculture subsidization fund was increased this year and totals over 1.7 billion lei, these funds are not enough. The strategic partners can help alleviate the effects of the drought and cover the price discrepancy caused by the Ukrainian production in times of war.”
Igor Grigoriev considers the state in such conditions can provide tax concessions to farmers. The taxes for farmers can be decreased or even annulled for a period.
Moldova currently exports grain to Romania, Bulgaria, Turkey, Egypt, Libya, Italy, Spain and other states.
