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explained, in Ukraine, the railway track is wide, but in Europe, it is narrow. This affects not only overloading but also product storage. In addition, during overloading, impurities can get into metallurgical products, and cleaning is expensive. Because of this, Metinvest lost more than $19M in 2022 alone. "The route through Poland entails serious logistical difficulties. There are problems with the speed of movement of goods - it is half as much as compared to Ukrainian," the manager emphasized.
● Partners & regions
Lithuania offers another way to export grain from Ukraine. After Russia's withdrawal from the grain agreement, the port of Klaipėda may become a new gateway for Ukrainian agricultural products. Lithuania has proposed to deliver Ukrainian grain to the port via the Niman River, Delfi reports. Using an inland water corridor may be the best logistical solution. It would also contribute to the development of freight transportation on the country's largest river. When transporting Ukrainian grain by rail and reloading it in Kaunas, it would be necessary to change tracks and transship the cargo from one train to another, not once but twice. Eliminating the additional grain transfer would significantly reduce costs. Freight transportation by inland waterways can be 30-40% cheaper than by land. In addition, it is possible to improve the grain storage and transshipment capacities of the Linas Agro holding, which is already operating at the Nieman berths. Also, constructing the European railway line to Klaipeda will take time. However, Lithuania could receive Ukrainian grain and other cargoes at the Klaipeda port by including its inland waterways in the transport chain. And the port could become an alternative to the Polish ports of Gdansk and Gdynia.
Poland Ukraine’s main EU trade partner. Since the beginning of the full-scale war in 2022 until the end of May 2023, its exports to Ukraine amounted to almost €14bn, which is a third of the EU's exports and 2.5 times higher than Germany's exports, said the European Commissioner of Agriculture, Janusz Wojciechowski. Wojciechowski recommended seeing Polish-Ukrainian relations as a strategic political partnership and a "strategic economic partnership, which is very beneficial for Poland so far."
Ukraine increased its exports of agricultural products to the EU and Asia.In January-June 2023, the Institute of Agrarian Economics reports that the export of Ukrainian agricultural goods increased by 16% from $10.22B to $ 11.85 B. According to experts, the main sales markets for Ukraine's agricultural products are three regions: the EU, Asia, and Africa. In the first half of 2023, about 82% of Ukrainian agricultural product exports' total value were exported to these countries. At the same time, there is an increase in supplies to the EU, which is the primary sales market for the second year in a row, as well as to Asia, while food exports to Africa are decreasing, the Institute of Agrarian Economics noted. They added that the share of agricultural exports in Ukraine's total exports for the first six months of 2023 is 61%.
Poland demands €1B from the EU to transit Ukrainian grain. Due to the grain agreement's disruption, Poland stated that investments in developing its logistics infrastructure to increase the export of Ukrainian grain and other agricultural products should amount to at least €1B. According to Polskie Radio 24, Poland stated that at least €500M is needed to expand border terminals for heavy trucks and railway infrastructure in Przemyśl. The second €500M should be spent on the modernization of railway border crossings between Poland and Ukraine, constructing terminals for trucks, and developing infrastructure for cargo traffic management at the border. At the same time, the European Commission has already approved a €176M Polish program to support companies during the war between Russia and Ukraine. The aid, provided as subsidies on loan interest rates, will be available to companies engaged in the trade or purchasing of grain and agricultural seeds.
30 UKRAINE Country Report September 2023 www.intellinews.com