Sea and river grain ports and terminals.

One of the promising, profitable and investment-attractive areas of activity in Ukraine is the production of grain. Over the past 10 years, Ukraine has become one of the world leaders in the production and export of grain, demonstrating a steady increase in yields and an increase in the export potential of agriculture. Favorable weather conditions in 2008 made it possible collect a record harvest - more than 53 million tons. 2009 was no less fruitful: about 49 million tons were harvested. The harvest of 2010 was smaller, however, it also amounted to more than 45 million tons.

Ports of Ukraine, No. 04 (106) 2011
Gennady Skvortsov
Economics and Management

One of the promising, profitable and investment-attractive areas of activity in Ukraine is the production of grain.
Over the past 10 years, Ukraine has become one of the world leaders in the production and export of grain, demonstrating a steady increase in yields and an increase in the export potential of agriculture.
Favorable weather conditions in 2008 made it possible to collect a record harvest - more than 53 million tons. 2009 was no less fruitful: about 49 million tons were harvested. The harvest of 2010 was smaller, however, it also amounted to more than 45 million tons.
The most important issue after the harvest is the issue of grain conservation and export. The internal needs of Ukraine are 26-27 million tons, therefore, at least 23-27 million tons are subject to export. To this figure should be added 3-4 million tons of exported mass
personal cultures. More than 90% of the export flow of grain from Ukraine is shipped through ports - by sea (in bulk). Port grain elevators (terminals) are used for export.
From a logistical point of view, the Black Sea coast of Ukraine is ideally located for grain shipments. Large shiploads can be shipped all over the world, small shiploads - in the direction of the Mediterranean countries. Freight rates for shipments from the Black Sea ports in these directions are lower compared to shipments from countries such as Germany and France.
Transit transportation of grain from Russia and Kazakhstan is also becoming an important factor in increasing the cargo turnover of Ukrainian ports. Russia and Kazakhstan are gravitating towards exports through Ukrainian Black Sea ports, and these countries are also building up their agricultural potential.
About 250 thousand tons of grain from Russia was exported in the last marketing year through Ukrainian seaports.
At the same time, there is a steady downward trend in transit volumes, and this, in my opinion, is influenced by the transport sector.
The most important condition for ensuring the export of grain is the availability of an efficient transport system, that is, the ability of road, rail and sea transport to ensure the fulfillment of the conditions for the delivery of goods in accordance with the concluded contracts.
Already today it is necessary to take a whole range of measures to improve and develop the existing road, rail and sea transportation of grain in Ukraine. We are talking about the delivery of grain to ports, increasing storage capacities for grain cargo in ports, providing services to bring the quality of grain to the level of European standards, analyzing the quality of grain, transshipment and customs clearance of commercial lots, cargo insurance, and so on. All these works and services affect the final price of Ukrainian grain, their competitiveness in the market.

Sea transportation of grain in the Black Sea region
More than 90% of world grain trade is carried out by sea. A feature of bulk cargo transportation in Ukraine and the Black Sea region as a whole is that, for a number of reasons, grain is transported not only by large-capacity vessels, but also by small, medium-sized vessels with a carrying capacity of 3 to 10 thousand tons. Although there have been recent efforts to increase the use of large-capacity fleets in order to reduce freight costs, the proportion of grain cargo carried by small and medium-sized vessels has remained basically unchanged.
Traditionally, the largest volumes of shipments through ports fall on September-December, with a subsequent decrease.
The maximum volume of monthly shipments (September 2008) is more than 2.6 million tons of grain.

Grain transshipment capacities
In Ukraine, transshipment of export and transit grain cargoes takes place in the waters of 13 out of 18 commercial seaports. , Sevastopol, Ust-Danube. Of these ports, 11 are located on the Black Sea, 2 ports - on the Sea of ​​Azov. Transshipment is carried out where the ports themselves, and where - private terminals located in their waters.
In addition, some volumes of grain are exported through Ilyichevsk and Kerch fishing ports, Nikolaev, Kherson and Dnepropetrovsk river ports, berths and shipyard terminals.
The unique position of Ukrainian ports and their proximity to a number of key markets (Middle East, North Africa, Europe) significantly increase the competitiveness of these ports, despite the efforts of other countries to develop their own port capacities.
Ports through which grain is exported can be conditionally combined into 3 main groups:
The first group is ports, in the waters of which there are powerful specialized grain terminals. They rely on cargo flows from all over Ukraine, as well as transit grain from Russia and Kazakhstan. This group of ports includes Ilyichevsk, Odessa, Yuzhny, Sevastopol.
This group of ports has the following distinctive characteristics:
?possibility of loading large-capacity panamax-type vessels;
?high speed of receiving/loading grain onto a ship (due to the availability of specialized equipment and mechanization schemes), traditional for port and elevator complexes (belt conveyors, bucket elevators, ship loading machines);
- the presence of significant capacities for grain storage.
The ports of the first group transship the largest part of grain cargo, and their share in the total transshipment is estimated at 60-65%, depending on the season.
The second group includes ports with specialized grain terminals of small capacity, non-specialized terminals converted for transshipment of grain, and limited depths at the berths.
Their potential grain transshipment capacity is lower compared to the ports of the 1st group (up to 1.5 million tons per year). This group of ports includes Nikolaev, Kherson.
The maximum size of ships accepted by these ports reaches 35 thousand tons. The share of these ports ranges from 25% to 30%, depending on the season.
The third group is the ports that do not have elevators and specialized terminals.
They are able to ensure the export of grain, using temporary or seasonal technology and a mechanization scheme that allows you to work on the direct option "wagon-ship", "car-ship" and "barge-ship".
This group of ports includes Belgorod-Dnestrovsky, Reni, Skadovsk, Berdyansk, Ust-Dunaysk.
The ports of the third group account for about 16% of the transshipped grain in the 2002/2003-2003/2004 seasons. In the 2004/2005 and 2005/2006 seasons, the share of these ports decreased to 5-7%. In 2008/2009, the share of these ports in the total transshipment amounted to 1.8%.
The declared capacity of grain terminals in Ukrainian ports, according to studies by a number of companies, is 32-34 million tons per year, but most of these terminals are located in shallow water and river ports. This circumstance significantly reduces the efficiency and profitability of export operations through such terminals.
In this regard, during peak periods of demand for shipping by sea, deep-water terminals are 100% loaded, and at the same time, the demand for them is partially covered by the so-called direct option, which is the most risky and not optimal for the shipper and all participants in transportation.
Therefore, it is difficult to agree with the opinion that Ukraine has sufficient capacity of port grain terminals to meet export needs.

Bandwidth
terminals in the amount of 32-34 million tons, shown in some studies, is only theoretical, not reflecting the real picture. After all, the capacities of 6 million tons of this amount are the capacities of the terminals operating according to the “direct option”, i.e. do not have warehouses for the accumulation of grain. Usually these are places for transshipment of grain directly from railway cars, which are used as warehouses. Due to the growth in the cost of such a service (the use of wagons as warehouses) and a decrease in the fleet of grain wagons, further growth in exports will lead to a restriction or prohibition of the use of wagons as warehouses. In addition, 17 million tons of transshipment capacity is owned by grain traders and, as a rule, cannot be used by other competing traders. Finally, the indicated throughput does not take into account the arrhythmia of the market.
Our estimate of the actual capacity of port grain terminals is 28 million tons (including 6 million tons of direct transshipment terminals), of which less than 50% are modern high-tech terminals. Therefore, the existing port facilities are not yet able to qualitatively meet the needs of the growing export of grain.
In recent years, port capacities for transshipment of grain have been actively developed. Port terminals are complex and expensive engineering structures. However, investors showed an active interest in
construction of new and expansion of existing transshipment facilities. The reasons for such an expensive hobby:
?the presence of factors affecting the rhythm of grain export (government policy, certification, lack of regional storage facilities);
?dependence of grain owners on the unpredictability of terminal services of terminal owners (speculation on services, the ability to influence the formation of the grain market);
?the desire to optimize transport services in terms of price and quality (increasing the tonnage of ship calls, finalizing the goods, reducing the cost of terminal services to the level of prime cost).
At the same time, only large traders can carry out the construction of terminals.
And what about small and medium producers? In my opinion, today they are not especially protected, on the one hand, from the ill-conceived state policy, on the other hand, from the dictates of the monopolists of transport services.
In order to avoid this, it is necessary to build an effective, maximally independent of external factors system for the delivery of agricultural products from the place of production to the consumer market. It is necessary to develop a network of regional commodity accumulators in close proximity to transport networks and independent port terminals that live off the provision of terminal services.

2016 and 2017 turned out to be profitable for Russian agricultural companies. The Russian Federation has increased grain exports, now it is above 37.5 million tons per year. Recently, an agreement was signed with China on the purchase of wheat. European countries also buy domestic grain, mainly for livestock feed.

But the growth of exports complicates one vestige - transshipment of grain in ports costs Russian companies 2 times more than their foreign counterparts. Now they are asking $19 per ton. For comparison: in Europe and America the rates are 8-9 dollars, and in Ukraine - 12.

Who benefits from raising rates?

Representatives of different industries assess the current state of the transshipment business in their own way. Logistics companies are confident that inflated tariffs will not last long. Experts give a year and a half for the port to take no more than 12 dollars per ton of grain in our country.

Owners of large deep-water bases have already experienced increased competition - another factor in lowering rates. In the last 4 years alone, dozens of small ports have appeared in Russia, and they account for 40% of all traffic.

Novorossiysk turned out to be the leading city in terms of grain transshipment. More than 20 transshipment bases operate in its harbors, and until recently there was only one. You can imagine how much competition reigns in the district.

Experts are sure that now it is unprofitable for businessmen themselves to keep rates at the same level. Over 5 years, they have decreased by 2 times, and in 2018 they will reach the level of Europe and the USA.

Agricultural companies have long adapted to the current situation and regulate competitive prices for exported grain. But supplies are increasing and it is becoming difficult to operate profitably.

Why prices will fall

In addition to competition, bandwidth and technology are critical. The speed and efficiency of transshipment in the port depend on the technical equipment. Now there are huge queues at each base, traffic is limited, and all this negatively affects the rates.

Grain transshipment technology is one of the most complex. Unlike other similar services, such as coal transshipment, the company spends more time and money. The average rate of coal transshipment is $12.

Already next year, the companies will increase the throughput of ports by 2 times. According to NKHP, their terminal will be able to process 6 million tons of grain instead of 3.5 this season. Other factories will also undergo reconstruction.

On average, Russia's transshipment capacity will reach 60 million tons against the current 47 million.

Prices, as now, will not be static. In good years, the rate always increases, in lean years it decreases. Tariffs are lowest in spring as grain export traffic reaches its lowest level in a year.

Other problems

Another acute problem is transport tariffs. The state of affairs in this area does not allow you to quickly export large quantities, so they can lie in warehouses for up to a year.

The Ministry of Agriculture has already developed a project to transfer grain and legumes to the first class according to Price List 10-01. Now these products belong to the second class, which complicates the clearance and increases the time of transportation.

It brought together more than 100 key players in the grain market.

The forum discussed the prospects for the development of export potential in the Azov region, because the Sea of ​​\u200b\u200bAzov is actively increasing the shipment of grain from its ports.

Today, many people associate Mariupol not only with metallurgy, but also with the export of grain. The region has its own peculiarities in work, so the tasks for exporters and stevedores are also special here.

Task 1. Attract agricultural producers

Mariupol port is gradually being re-profiled and focuses on agricultural transshipment. This trend was noted by Andrey Shklyar, head of the CFTS expert area and moderator of the forum. Moreover, the number of agricultural cargo in the port is growing much faster than in the whole country. From 2007 to 2016 the average annual increase in the transshipment of agricultural products in Mariupol amounted to more than 43%, and in Ukraine this figure is 16%.

Andrey Shklyar also pointed to a significant increase in grain exports through the Mariupol port to Africa, the EU and the Middle East. In particular, the volume of grain exports to Africa through Mariupol has grown over the past three years by 6 times, exports to the EU have increased by 37 times.

Although, with such an increase, the share of the ports of the Sea of ​​Azov in total exports remains small. They transship 1-2% of the total volume of grain and oil exported by Ukraine.

Paradoxically, the region closest to the Azov terminals - Eastern Ukraine - prefers to work with the Black Sea ports. The terminals of the Azov region process only 11% of Eastern Ukrainian grain, but, according to the analyst, the situation may change radically.

“At the moment, 89% of Eastern Ukrainian grain is exported through the Black Sea ports. But if the Azov ports offer competitive conditions, logistics in the region will improve, then part of this grain will come to the terminals of the Azov region. And this is another 3-4 million tons of grain transshipment,” Andrei Shklyar believes.

Task 2. Attract foreign investors

Mariupol should become a more attractive port not only for agricultural producers in Eastern Ukraine, but also for foreign investors. To do this, Ukrainian port workers need to overcome a number of internal problems. Evgenia Luganovskaya, coordinator of the working group on business support in the ATO zone EVA, spoke about this at the forum.

“Problems that concern foreign investors are, first of all, corruption and the inconsistency of the legislative field. And only in third place do they put a military conflict,” says Evgenia Luganovskaya.

The specialist advised representatives of agribusiness in Mariupol to create their own lobby to attract investment to the region.

“We need to talk about Mariupol, create a Mariupol lobby at the all-Ukrainian level. Only then will you be able to raise your investment attractiveness. Especially now, within the framework of decentralization, the regions have such an opportunity. Therefore, come to Kyiv, speak louder, declare yourself,” Evgenia Luganovskaya advises.

Task 3. Retain exporters

Many importing countries of Ukrainian grain prefer to buy it in small batches ─ from 5 to 15 thousand tons. Such an export batch is placed on coaster-type vessels (draft 4.4-6.5 m), which can enter the shallow ports of Azov. Therefore, Valenty Selvesyuk, head of the Agrotrading project at UMG AGRO, believes that it is beneficial for traders to work with Azov terminals.

However, small coaster ports may lose their attractiveness for exporters due to increased competition among terminals and lower transshipment rates. This year, the cost of transshipment at large terminals of deep-sea ports has fallen to $15, and at small ones to $10.

“But I doubt very much that if the big terminals lower their bet to $10, the smaller terminals will be able to lower theirs to $5. And they certainly won't lower the bet to $2 or $3. Thus, large terminals will become much more attractive,” the trader noted.

Another component of grain exports, the ship's freight rate, may have a negative impact on the Azov region in the event of a decrease in transshipment prices.

“If Egypt buys wheat on FOB terms, then in Odessa the price of a ton was $170, $10 ─ freight and transshipment ─ $15. In Mariupol, the price of a ton of wheat is $180, $20 for freight and $10 for transshipment. As you can see, the difference in transshipment does not compensate for the difference in freight. So far, the proximity of the Azov ports to the producers saves them, because it is profitable. But as soon as rates go down, the picture may change,” says Valenty Selvesyuk.

This season, the fact that the railway will not be able to cope with the huge load in the ports of Big Odessa and Nikolaev can play into the hands of small and medium-sized Ukrainian ports in the competitive struggle. There, at the same time, from September to December, cargo flows of exported grain and iron ore and coal imported from South Africa will meet.

“I have great doubts that ports and port railway stations will work without problems in this non-trivial challenge,” says Andriy Shklyar.

According to him, not all exporters will want to stand in long queues in Odessa and Chernomorsk, and good prospects will open up for the ports of the Sea of ​​Azov.

Task 4. Pass the Kerch Strait

A new headache for the Azov ports was the official letter received on May 24, 2017 from the Kerch port about a new restriction on the passage of the strait for ships. To the already existing requirements for a vessel length of 160 m and a width of 31 m, a new one was added ─ the free clearance, that is, the distance from the waterline to the highest part of the mast, should not exceed 33 m. The number of ships that can pass through the Kerch Strait will be reduced .

“About 30% of the vessels we work with fall under these restrictions. Basically, the problem is because of the height. These vessels slightly exceed the established norms. Let's hope that common sense will prevail and the restrictions will be reviewed or compromises will be found,” says the CEO.

Anton Shapran, director of Maritime Logistics LLC, a Mariupol company, believes that the new restrictions may lead to an increase in freight rates, and entail an increase in the cost of grain logistics.

And here is the acting. Igor Barsky, Deputy Director for the Operation of the Mariupol Sea Port, expressed confidence that this problem would be solved over time, because money is paid for the passage of the strait, which the recipient of payments does not want to lose. In addition, ships of the federal type will come to the Sea of ​​Azov.

“There is a fleet that can operate in such conditions. This is federal-type vessels that operate in North America on major rivers and pass freely under bridges. Part of this fleet is already working with the Azov ports. In the near future, two such vessels will arrive at the Mariupol port,” says Igor Barsky.

Task 5. Get to the port

The region has its own specifics in logistics, both in road and rail transport. Recently, the leadership of the Mariupol Sea Port managed to get Ukrzaliznytsia to cancel the collection of fees at the Mariupol-port station. Now railway cargo is accepted here on the same terms as other Ukrainian ports.

On June 1, 2017, a second track was opened to increase the freight traffic to Mariupol on the Rozovka-Zachatievskaya railway section. The new capacity of the railway will be 28 trains per day. However, Igor Barsky considers this figure "theoretical".

“There is one bottleneck left: the Khlebodarovka – Zachatievskaya section, an 18-kilometer single-track section. Therefore, the declared 28 trains is a theoretical figure. It will be very difficult to achieve it in practice, since locomotive traction will not be added to the section,” the head said.

Russia has become the world leader in sales of wheat for export, follows from the data of the Russian Ministry of Agriculture and the report of the US Department of Agriculture. Moreover, Russia became the leader for the first time in modern history. A year earlier, Russia ranked only 3rd after Canada and the United States. The main reason for Russia to take the 1st place is a record wheat harvest in the south of the country (Krasnodar and Stavropol Territories, Rostov Region). As a result, the share of these regions in export deliveries increased from 80 to 85%. In addition, exports have become more profitable due to the devaluation of the ruble. More than 130 countries buy Russian wheat. The largest consumers are Egypt, Turkey and Iran.

The grain harvest in Russia in 2017 amounted to about 128 million tons, and the corn harvest broke the record of 2016. The wheat harvest in 2017 is estimated at 80 million tons against 73.3 million tons in 2016.

At the end of 2017, it became obvious that the infrastructure of the port of Novorossiysk could not cope with the increase in export cargo traffic, the granaries were overcrowded, and the port's transshipment capabilities had been exhausted. Also, there are not always free ships and barges for the transportation of grain during the periods of the “medium and high seasons”. In connection with the current situation, many exporting companies are looking for alternative ways to transship and send their cargo through the port of Novorossiysk by sea.

Our Company offers a new method of transshipment - in specialized containers with cargo hatches at the end (see photo below), at our own off-port terminal and further shipment of grain in containers or ship lots.

Containerization, transshipment and terminal services

How it works:

1. We accept yourcargo in any way convenient for you: a) by rail in hopper cars or containers; b) by road: grain carriers, containers, tents, etc.

2. We accumulate grain in covered dry warehouses until a certain tonnage required by the client is reached. For example, the formation of ship or container lots.

We also provide our customers with good conditions and preferential free storage of cargo during the accumulation of such lots.

3. We fumigate your cargo in accordance with the requirements of the customs legislation of the Russian Federation, as well as the importing country that receives the cargo. The most common types of fumigation are: aluminum phosphide, magnesium phosphide, methyl bromide treatment and the so-called "wet fumigation".

4. We issue all necessary permits, such as: fumigation, phytosanitary certificates, certificate of origin, GMO, international quality certificate, certificate of origin, certificate VGM etc. We carry out customs clearance of cargo.

5. The work of the export and loading of cargo on the ship is carried out according to the direct option. Cargo from the warehouse is poured into specialized containers of 25 tons, passes control weighing and is delivered to the port of Novorossiysk on board the vessel.

Loading grain in the port by direct option

Advantages of this solution:

1. High loading intensity of at least 5000 tons per day

2. The possibility of forming any ship parties,

3. Much more extended preferential storage period compared to the port of Novorossiysk.

4. A full range of related services for receiving and processing cargo, issuing the necessary accompanying documents and customs clearance.

Each shipment requires a separate solution for specific tasks and goals of a specific client. Please contact us for a free consultation and calculation of the cost of our services.

text by Olesya Merkulova

The image of Russian grain exports is being threatened by complaints from importers about trash that is found in products shipped from the south. Rosselkhoznadzor has already checked 30 owners of grain loading sites in the ports of the Krasnodar Territory and the Rostov Region and threatens to suspend their work for 30 days. This comes amid record grain exports from southern ports

Rosselkhoznadzor warned 30 companies - owners of grain loading sites in the ports of the Krasnodar Territory and the Rostov Region of the possible suspension of their activities for 90 days due to serious sanitary violations, according to the agency's website.We are talking about companies that own cargo areas, relatively speaking, owners of berths, clarified "Expert Yug" in the press service of the department, without specifying the names of the companies and the location of the berths. Rosselkhoznadzor specialists examined the sites and foundspillage of grain at loading points, quarantine weeds, lack of integrity of territory coverings, lack of pest control equipment in most places, etc.” According to the agency, this is contrary to the Unified Quarantine Phytosanitary Requirements of the Eurasian Economic Union.

The reason for the checks was the claims of importers (from Vietnam and Indonesia) to the quality of grain, in which harmful organisms were found. In addition, the Rosselkhoznadzor will strengthen control over grain transshipment and conduct repeated inspections.

“Statements about a possible suspension of the activities of grain export players are taking place against the backdrop of record grain exports,” the IKAR analyst reminds Oleg Sukhanov. - Over the past three months, 15.5 million tons of grain have been exported from Russia - more than half of the so-called painless export potential, which was announced by the Ministry of Agriculture (30 million tons of grain). Although from my point of view, it could be 40 million tons of grain. At the same time, 14.2 million tons of grain were exported from the Krasnodar Territory and the Rostov Region.” According to him, this situation makes the Ministry of Agriculture worry and, perhaps, one of the levers for slowing down the growth of export volumes is additional checks. “Even by themselves, these statements make grain traders accept this risk and contract less, not play long, etc.,” the expert adds.

Rosselkhoznadzor rejects these accusations. The checks are not connected with the desire to restrict exports, but with complaints from importing countries about the quality of Russian products, ”the representative of the department insists. “After Indonesia and Vietnam filed complaints about the quality of our grain, we tightened control and, accordingly, spoke with both grain exporters and owners of goods transshipment points that it is necessary to take more seriously the fulfillment of the requirements of importing countries. Otherwise, we will lose the markets that we have conquered, and there will simply be no talk of opening new markets,” says the head of the press service of the Rosselkhoznadzor Julia Melano. She does not name the violating companies, but says that the list includes both large and small players. “Now everything is in the hands of these companies, if they correct the violations that have been identified, and we do not find them during the re-examination, the issue will be removed. Otherwise, we will initiate a suspension of activities for 90 days,” she added.

“In principle, there can be no such problem in large ports,” says Vladimir Beryants, a member of the board of directors of Krasnodarzernoprodukt. - We work with the Novorossiysk seaport, and the level of control for all loadings is very high there. If Rosselkhoznadzor found violations, then on some very small sites.” “There have been no such problems for many years, in general, the port infrastructure is very technological among the main players. I think these are some insignificant players,” adds Petr Svetlichny, Chairman of the Board of the Association of Grain Processing and Grain Receiving Enterprises of Kuban.

That transshipment of grain in the Rostov region is two times cheaper than in the deep-water ports of the Black Sea. “This is our competitive advantage,” Burakov said.

According to the analytical center Rusagrotrans, the total capacity of Russian ports for transshipment of grain for export in 2017/18 agricultural year amounted to about 55 million tons. Over the next five years, due to ongoing projects in the South, North-West, Far East, it can increase at least 30 million tons, the head of the center believes Igor Pavensky.

The 2017/18 season was marked by records for transshipment of grain in all directions, Pavensky draws attention. In particular, through the ports of Novorossiysk, Tuapse, Kavkaz (where volumes go from small ports to offshore transshipment), small ports, as well as the Baltic and Caspian. Thus, according to the analytical center "Rusagrotrans", the largest volume was sent abroad through the Novorossiysk grain terminals - 18.2 million tons against 12.2 million tons a year earlier. The small ports of the Azov-Black Sea basin in total shipped almost 16 million tons against 10.7 million tons in 2016/17. The Caucasus significantly increased transshipment - up to 5.2 million tons against 3 million tons in the previous agricultural year. At the same time, in fact, about 11.8 million tons will be exported through this port during the season, since most of the volume exported through it passes customs in small ports.