Port blockade could halt half of Ukrainian agricultural exports

Ukraine has proposed to the European Union to provide a grant of €220 million to support the liquidity of agricultural enterprises through preferential lending. The funds will not be paid directly to farmers: they are planned to be used to compensate interest and partially cover bank risks.

The mechanism can be implemented, in particular, through the expansion of the state program "Affordable loans 5-7-9%". According to the calculations of the Ministry of Agrarian Policy, the grant will allow attracting up to €4 billion of bank loans for the agricultural sector at a rate not exceeding 10% per annum. Thus, each euro of grant assistance should provide more than €18 of lending.

The proposal was discussed by Minister of Agrarian Policy Taras Vysotsky and his deputy Denys Bashlyk with representatives of EU countries, Norway, the World Bank and the UN Food and Agriculture Organization. According to the ministry, the participants agreed to work out the launch of the mechanism through Ukraine Facility and EU guarantee institutions within the next few weeks.

The Ministry of Agrarian Policy explains the need for support due to the closure of three deep-water ports of Greater Odesa because of Russian attacks. In the 2026/2027 marketing year, Ukraine planned to export about 64.4 million tons of agricultural products, or on average 5.4 million tons per month. However, in August only about 1.6 million tons of exports are expected.

Even after the restoration of alternative routes, their capacity, according to the ministry's estimate, will be a maximum of 2.9 million tons per month. Therefore, total exports for the season may be limited to 29.6 million tons - less than half of the planned volume.

By November, the deficit of storage capacity for the harvest could reach 11 million tons. The ministry estimates the value of products that will remain unsold at more than €10.8 billion.

Due to the accumulation of stocks, farmers risk being left without funds for salaries, land lease, fuel and fertilizers. This threatens above all small and medium-sized farms, which need to finance the 2027 sowing campaign.

Earlier, Current Ukraine reported that the government was only considering options for preferential lending, state guarantees and loans secured by the harvest. Currently, the allocation of €220 million has not been approved: it is a Ukrainian proposal that must be agreed with European partners.

According to: Ministry of Agrarian Policy and Food of Ukraine