The Danube route has become vital for Ukrainian agriculture after Russian missile strikes have all but paralyzed Black Sea shipping around Odesa.
Since Russia’s full-scale invasion in 2022, the Romanian port of Constanta has become an important alternative route for shipping Ukrainian grain to world markets. Shipments usually arrive at Constanța by rail, truck, and Danube barges. But this summer’s heat and lack of rain have pushed the Danube to record lows, forcing river vessels to carry smaller loads.
That reduction raises the cost of river transport, which in turn increases expenses and causes delays for road and rail links. The problem has emerged as Black Sea export routes need additional alternatives, and it is slowing flows from Romania, a major supplier of grain to the European Union.
“Ukraine’s state rail operator is also in talks with neighboring countries to add new export routes to create more avenues to move its grain,” Bloomberg noted.
“Still, the railway combined with the Danube river route can only transport a third of the capacity of Ukraine’s Black Sea ports, according to Agrarian Minister Taras Vysotskyi.”
The situation is being aggravated by high energy prices and disruptions to global trade from tensions in the Middle East. Wheat and corn futures rose sharply in July on exchanges in Paris and Chicago.
Burak Cetinok, global head of research at broker Arrow, said
that without immediate relief, either from a decrease in Black Sea hostilities
or a rebound in Danube water levels, prices could remain elevated.