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Ukraine Working to Restart Container Shipping and Build Danube Exports

Ukraine containership
Hong Kong-flagged containership Joseph Schulte was able to escape Odesa last year but container service remains suspended (Alexander Kubrakov/Facebook)

Published Mar 19, 2024 1:46 PM by The Maritime Executive

 

Ukraine looks to restore container traffic after its success since August 2023 at building grain shipments on its Black Sea corridor. Government officials highlight the addition of container service as well as the expansion of shipments on the Danube will support both the exports as well as increase imports while lowering the cost of goods and transport for Ukrainian businesses.

"The negotiations with the owners of containerships are ongoing, and we've already settled the insurance matter under the Ukraine Facility program," member of parliament and deputy minister Dmytro Solomchuk is quoted as saying in an interview on the Verkhovna Rada of Ukraine website. "It's crucial that both container shipowners and product customers have a vested interest in insurance. Funds for this are already secured. I'm confident that the beginning of container transportation will undoubtedly bring significant economic benefits."

Container movement by sea has been suspended for the more than two years since the Russian invasion and the blockading of the Black Sea ports. Last summer, a few containerships used the corridor largely to escape sequestration in the Black Sea ports, but the corridor has largely been for bulkers mostly transporting grain and ag products with smaller amounts of metal products.

Between August and the end of 2023, Ukraine highlighted that about 13 million tonnes of products were exported to 24 countries using the sea corridor. Deputy Prime Minister Oleksandr Kubrakov said 420 vessels had loaded in Ukraine’s Black Sea ports and traveled the corridor in 2023. Recently, he was quoted as saying it is now approaching 30 million tonnes and more than 1,000 vessels.

Resuming container shipments is extremely important for farmers said Solomchuk, who said that they could form small batches of grain and load it into containers. Also, he highlights the potential to ease the logistics for imports and reduce costs.

"If we start container transportation, the total volume of goods turnover could soar to thousands of tonnes daily,” predicted Solomchuk.

 

Containers are moving on the Danube and they hope soon through the Black Sea ports (Ukrainian Danube Shipping/Facebook)

 

Kubrakov is also highlighting the Danube as “an alternative and effective route for Ukrainian exports,” saying they are ready to increase exports from the Danube ports by using container barge caravans. He said since the beginning of 2024, 3.7 million tons of cargo have been moved on the Danube, including 2.5 million tonnes of ag products. By expanding shipments on the Danube to the EU he says they can also redirect blocked cargoes bypassing the Polish border.

The Ukrainian Danube Shipping Company is set to offer a comprehensive logistics service to transfer cargoes including grain as well as containers and metals said Deputy Direct General of the shipping company Vladislav Belakh. He said an agreement is in place with Hungary and they are working with Austria and Serbia.

“The potential of the Danube freight base is huge,” said Belakh. He said so far they are moving grains and ag products with volumes gradually increasing. This month he said supplies of iron ore raw materials will rise to the highest mark in the last year. He also looks to start transporting coal for themeral power plants.

Building exports and restoring imports is another critical step to restoring Ukraine’s economy.