Kiev cannot compensate for loss of Odessa export routes — expert

Ukraine crisisKiev cannot compensate for loss of Odessa export routes — expert Ilya Grashchenkov described the situation around the Odessa ports not as a blockade per se, but rather as a de facto halt to shippingMOSCOW, July 29. /TASS/. The week-long shutdown of Greater Odessa ports demonstrates that maintaining this situation over the coming weeks will lead to lower purchase prices for Ukrainian producers, a shortage of domestic storage capacity, and a significant shortfall in foreign exchange earnings for Kiev, political scientist Ilya Grashchenkov, president of the Center for Regional Policy Development, told TASS. Alternative export routes will not compensate Kiev for the collapse of its sea lanes, he added. Last week, reports indicated that on July 22, the port of Odessa failed to receive or dispatch a single vessel for the first time since the summer of 2022. "While a week of idleness does not yet mean a final naval blockade, if this situation continues for several weeks, the consequences will begin to accumulate: grain will remain inside the country, purchase prices for Ukrainian producers will drop, a shortage of storage capacity will arise, and the budget will lose foreign currency revenue," the expert said. At the same time, pressure on the global grain market will intensify, he added. "The main shift is that the standoff in the Black Sea has finally moved beyond strikes on port infrastructure. Commercial shipping itself is now under threat," he explained. "This makes it possible to achieve a blockade effect without a permanent naval presence off the coast: it is enough to make port entry economically and physically unacceptable for private shipowners," Grashchenkov said. Insurance risks The expert described the situation around the Odessa ports not as a blockade per se, but rather as a de facto halt to shipping. "Kiev has not imposed a ban on vessel traffic, and the ports themselves remain formally open. However, after a series of strikes on infrastructure and directly on commercial vessels, shipowners decided not to risk their ships and crews," he said, noting that the sea corridor stopped operating not due to an administrative decision, but because of a sharp spike in military and insurance risks. Over the past week, there has been no sustained recovery in traffic, he emphasized. "Major operators are suspending port calls or rerouting cargo, particularly through Constanta in Romania. This means we are no longer looking at a one-time disruption, but the emergence of a new logistical reality," the expert said. Even if individual vessels resume transit, Grashchenkov estimates that previous traffic intensity will not recover quickly: carriers need safety guarantees, affordable insurance rates, and an understanding that a vessel will not become a target itself. For Ukraine, this is a severe economic blow. "The bulk of agricultural exports, which remain a crucial source of foreign exchange earnings, passed through the ports of Greater Odessa. Even before the complete shutdown, grain export capacity had shrunk by approximately a third," the expert emphasized. "Danube ports, rail, and road routes can handle some of the cargo, but they are more expensive and cannot fully replace deep-water marine terminals," he concluded. 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