Constanta port operators optimist about a window of opportunity for Ukraine's grain

Viorel Panait, the manager of port operator Comvex (BVB: CMVX) and the president of the Constanta Port Business Association, told Reuters a lag in domestic grain harvesting and the reluctance of some Romanian farmers to sell their crops at low prices meant capacity would be available for Ukrainian grain until mid-August.

There are, however, reasonable grounds to believe that the pressure on Constanta port will exceed the port's capacities.

The port transshipped 8.6 million tonnes of grain from Ukraine in 2022 and 7.5 million tonnes in the first half of 2023. Experts estimate that 27 million tonnes of merchandise from Ukraine should be transshipped in the next marketing year that already started – after the Black Sea corridor was shut down by Russia and the seaports in Ukraine will no longer be accessible to ships (as Russia declared all ships heading to Uktraine's seaports as possible targets).

Ukraine can only use its three Danube ports to ship grains to Constanta and further through Bulgaria's waters to Turkey.

At its peak so far, Constanta handled 25 million tonnes of grain per year, which Panait said will be exceeded in 2023. Indeed, 15.25 million tonnes (+25% y/y) were already handled in H1, but this is still insufficient to compensate for the closure of the corridor that last marketing year absorbed half of the merchandise from Ukraine (compared to roughly a quarter of Constanta port).

"Harvesting in Romania starts slightly later than in Ukraine, which generates a pause between the two crops," Panait said on a positive note. "And some Romanian farmers are still holding onto their crops, so sales are stagnating at the moment."

Panait also said operators of grain terminals increased investment in equipment and management to boost operating capacity compared with the start of the war.

(Photo source: Claudiu Marius Pascalina/Dreamstime.com)