Extended Russian Ukraine Invasion has Stranded Merchant Mariners, Crippled Wheat Production

Extended Russian Ukraine Invasion has Stranded Merchant Mariners, Crippled Wheat Production
Heather Mongilio April 7, 2022 https://news.usni.org/2022/04/07/extended-russian-ukraine-invasion-has-s...

Nearly six weeks into the war in Ukraine, merchant ships in the Black Sea have become stranded, halting the import and export of vital commodities, a situation that could have wide-ranging impacts on the global economy.

With the Black Sea blockaded by Russia and Ukraine placing mines around its ports, merchant ships can neither come nor go, leaving the mariners aboard stuck in a war zone.

Merchant ship Azburg, pulled into port at the Ukrainian city of Mariupol on Feb. 23. The next day, Russia invaded Ukraine. The ship sank Tuesday after being hit by a Russian missile, according to Reuters. A senior defense official said that the ship was hit by a Russian missile. The ship’s sinking highlights two secondary crises unfolding as the Russian invasion continues.

The ports in Ukraine are closed. Ships cannot enter and they cannot leave. As the war drags on for more than 40 days, Ukraine, a bread basket in eastern Europe, is unable to export wheat and other grains to countries in the Middle East and North Africa.

With ports closed, individuals on the merchant ships are stranded, either because they have not been allowed to leave their ships or because they are foreigners in a war zone, Sal Mercogliano, a maritime historian at Campbell University, told USNI News.

The Dominica ship is at least the second merchant ship to become a casualty in the Russian invasion into Ukraine.

Rusen Mete, a cargo ship, was reportedly at port in Berdyansk, USNI News contributor H I Sutton tweeted. Ship spotters reported March 29 that the ship caught on fire, a casualty of a fire that broke out on a Russian warship on March 24.

Two seafarers have been killed and five other merchant ships have been hit by missiles since the war began, Reuters reported.

There are about 1,000 mariners from crews on small and large vessels who need to be extracted, Mercogliano said. Some are not yet allowed to leave their ships. Others who have been told to abandon their ship now need to cross into other countries.

The International Maritime Organization is tracking 86 vessels stuck in the Black Sea, according to the Reuters report.

That can be difficult because they are all foreign nationals.

“But again, they got to be allowed to cross over to the borders, because these aren’t Ukrainians coming across,” Mercogliano said. “These would be Filipinos, Indians, Indonesians, Chinese and potentially some Russians too, because Russia makes up 10 percent of the world’s ocean fleet members.”

And with ships unable to leave the ports, Ukraine is not able to export its wheat supply to the countries that rely on it, opening the potential for a food shortage.

“It’s a big issue,” Mercogliano said. “We’ve been talking about the issue of potential food shortages because Ukraine is responsible for 10 percent of the world’s grain exports, and that’s a combination of wheat, corn, barley and everything else. Other countries are going to have to either pick up that slack, but that’s going to be very difficult to do. And then you’re going to have to get shipping to relocate to do it.”

The large percentage of grain exports is why Ukraine’s flag is half yellow, Mercogliano noted.

It provides the wheat to countries in the Middle East, Africa, Europe and Asia. In 2020, Ukraine was the fifth largest wheat exporter, with $4.16 billion in exports, according to the Observatory of Economic Complexity.

Egypt, Indonesia, Pakistan, Bangladesh and Lebanon were the top five importers of Ukrainian wheat in 2020, according to OEC.

There are several problems preventing wheat exportation since Russia invaded, said Johanna Mendelson Forman, an adjunct professor at American University.

First, it’s unclear if Ukraine was able to plant its wheat during the planting season, she said.

While most of the fighting has been in the south and central parts of Ukraine, as Russia aimed to take population centers like Mariupol and Kyiv, wheat grows in the western part of the country, she said. So while the field may be untouched, the planters may not be available, as Ukrainians have joined the country’s military or left the country.

Then there is the issue of fertilizing the ground, Forman said. Ukraine typically gets its fertilizer from Russia and Belarus.

Even if the wheat was planted, it would need to be harvested, which requires large machinery that needs diesel, she said. Another unavailable commodity.

As for the ports, Ukraine does not have a way to export the grain, even if it could be harvested, Mercogliano said.

The majority of Ukraine’s wheat is exported through Odesa, port Pivdennyi, Mykolayiv and Chornomorsk, Niels Graham wrote for the Atlantic Council. If a port was available, insurance for the voyage would be too expensive, he wrote.

Russia is currently blockading the Black Sea, preventing Ukraine from using its ports, he said. Ukraine mined the beaches to prevent Russian troops from making an amphibious landing.

Those mines have been swept into the waters, making the sea dangerous for ships, Mercogliano said.

Without the wheat being exported from Ukraine, the world could see a potential “food meltdown,” Forman said.

Food supplies can be replaced or come from different sources when one distributor is unavailable, she said. But in the case of Ukraine, there was not enough time to plan for the lack of wheat, in part because there was a sense of denial that Russia would go through with its invasion.

That means the market now needs to identify where stockpiles are and where wheat can come from, she said.

“That’s a large amount of wheat to replace,” Forman said.

This issue is only compounded by the ongoing COVID-19 pandemic, which has affected supply chains, and climate change, she said. Argentina, which is a large supplier of wheat, is struggling to export its wheat due to a drought. China, another large supplier, said it experienced its worst winter wheat ever due to heavy rainfall, according to Graham’s Atlantic Council report.

Russia is also a large supplier of wheat, accounting for about a third of the exports when combined with Ukraine, according to the Atlantic Council. Countries and companies are sanctioning Russia over the invasion, which makes it nearly impossible to access that wheat.

The sanctions are also raising insurance costs for Russian shipping, making it too expensive to export wheat from Russia, according to the Atlantic Council. When there is a food shortage, prices rise which can lead to violence , Forman said

“There’s potential for great destabilization in weak countries that don’t have good safety nets,” Forman said. “That’s clear. And when you have so many countries in Africa, which are just living on the edge, in many cases, of lower middle income status, it can have a devastating effect on the economy.”

There are other countries that can help alleviate some of the burden, including the United States, which likely has stockpiles of grain, Forman said. No one wants to see the destabilization of a country like Egypt, she said.

For Ukraine, once the growing season is gone, it is lost. The country’s farmers will have to wait until the next season to start growing, if they are able to start during the next season. It is unclear what longer effects the Russian invasion will have on wheat production, Forman said.

There are “many variables … how damaged the land is, what kind of munitions have been in the ground, whether they have the labor supply, how many people they’ve lost,” she said. “We’ve got 4 billion people that migrated. It’s mostly women and children, but you still have to have a labor force. And Ukraine is losing soldiers also. So what’s happening to that generation?”