Miller Magazine Issue: 156 December 2022

78 ARTICLE MILLER / DECEMBER 2022 Maksym Kharchenko Logistics Market Analys t UkrAgroConsult The grain deal’s extension will push up demand from major importers and consequently lead to stronger domestic demand from Ukrainian exporters. So, domestic prices will likely grow. Increasing supply from Ukraine will pull down global prices. However, it nevertheless should be kept in mind that importers will likely wait for a certain period after the beginning of the “grain deal’s” new term, though this period will not be as long as it was in August. Black Sea Grain Corridor: Rerouting Global Grain Trade & Pricing November 19 was the expiry date of the first stage of the “grain deal.” On November 17, the Infrastructure Minister of Ukraine announced the extension of the deal for another 120 days. Nevertheless, most sales remain on hold until the situation is clarified. Grain market had a chance to see a “trial version” of the deal’s termination on October 29, when Russia announced its withdrawal from the agreement. However, the Big Odesa ports kept loading ships, and the Joint Coordination Cen- ter in Istanbul continued its inspection work. So, 14 vessels carrying almost 430 K mt of grains, oilseeds and processed products left the Odesa ports between October 30 and No- vember 1. The UN and Turkey, taking advantage of the ab- sence of the Russian federation, increased the number of inspection teams to 10, thanks to which the Joint Coordina- tion Center inspected 46 vessels with 1.7 M mt of Ukrainian agricultural products on October 31 alone. As a result, the queue of both outgoing and incoming vessels waiting for inspection in the Bosphorus was reduced to 147. The short-term refusal of Russia to participate in the “grain deal” once again made us think about the future prospects of agricultural exports from Ukraine. The above-mentioned practice shows that the deal may be terminated at any mo- ment, which suggests UkrAgroConsult to consider two sce- narios for further exports – optimistic and pessimistic ones. OPTIMISTIC SCENARIO: THE “GRAIN DEAL” WILL BE EXTENDED EACH TIME AFTER THE EXPIRATION OF 120 DAYS 1. How will this affect prices? The deal’s extension will push up demand from major importers and consequently lead to stronger domestic de- mand from Ukrainian exporters. So, domestic prices will likely grow. Increasing supply from Ukraine will pull down global prices. However, it nevertheless should be kept in mind that im- porters will likely wait for a certain period after the begin- ning of the “grain deal’s” new term, though this period will not be as long as it was in August. 2. How will this affect exports? The temporary absence of Russia’s representatives during the inspections showed that these inspections