Today's combined attack on Novorossiysk, which shut down a grain terminal and damaged port infrastructure, will lead to further price increases on global food markets, a drop in prices in Russia and Ukraine, and will also directly impact the incomes of Kazakhstan's farmers, APK News reports.
As Yevgeny Karabanov, an analyst with the Kazakhstan Grain Union, reported today, Novorossiysk was hit by a massive combined missile and drone attack last night, using unmanned naval vessels. The attack damaged several port infrastructure facilities.
According to Reuters, the grain terminal in Novorossiysk has stopped operations following the Ukrainian attack. The owner of the facility, Demetra Holding, confirmed that the terminal was damaged. "Work has now been suspended, and damage assessments are underway," Karabanov noted.
According to his assessment, a further escalation of military action in the Black Sea, resulting from the destruction of Russian and Ukrainian vessels and infrastructure, will significantly complicate the export of grain, oilseeds, and processed products from these countries. This will lead to a further rise in prices on global food markets and a fall in agricultural prices in Russia and Ukraine. Alternative agricultural export routes for both countries will not be able to replace the transshipment capacity at Black Sea terminals and will lead to a significant increase in exporters' logistics costs.
For Kazakhstan, the negative consequences of an escalation in the Black Sea will include not only increased pressure from Russian agricultural products on the Kazakh market, but also on the markets of Central Asian countries, with significant price discounts.
The most vulnerable markets will be wheat, barley, rapeseed, sunflower seed, flaxseed, safflower, and processed products such as flour, bran, vegetable oils, meal, and cake.
All this could lead to lower prices for these products, and consequently, lower prices for grain and oilseed crops for Kazakhstan's agricultural producers, the expert concluded.