Major global shipping companies have shied away from Ukraine’s Odesa port in recent weeks. The situation is reminiscent of earlier stages of the war, when Russian attacks also halted Ukrainian maritime trade. Once again, it is pushing freight flows onto other (EU) corridors. In the meantime, Ukrainian Railways is looking to secure a favourable deal with Moldova.
Russia has ramped up its attacks on port infrastructure and ships in the Odesa region on Ukraine’s Black Sea coast. As a result, shipping companies like CMA CGM, Hapag-Lloyd and Maersk have suspended their operations in the area.
CMA CGM pointed out that it would seek to divert freight flows through the Polish port of Gdańsk and the Romanian Black Sea port of Constanța. Maersk also said it would divert Ukrainian imports to Constanța. Hapag-Lloyd stated that it would look into Ukraine’s Danube port Reni as an alternative discharging site.
Ukrainian imports and exports will have to find their way onto European overland corridors once again. In order to get to Constanța, for example, one needs to organise land-based transport through Romania and possibly Moldova. Ukrainian Railways has approached the latter for a 50% discount on transit, according to Ukrainian media.
A lifeline for Moldovan rail
Not everyone may be keen to offer such a discount. For example, Moldovan farmers have reportedly expressed concerns about the import and transit of Ukrainian grain through its territory. Polish farmers have had similar concerns in the past. The Moldovan national government, however, said that it would not stop supporting Ukraine. It also added that Moldova would not forego the opportunity of additional rail transit income.
The Moldovan rail operator CFM could indeed use the extra volume of freight. Its business activities grew markedly when the Odesa port was unusable earlier during the war. When maritime shipping returned to Odesa, CFM was plunged into a financial crisis. Simultaneously, CFM is asking Ukrainian Railways for additional locomotives to facilitate the movement of freight on its network. The Moldovan operator itself does not have enough rolling stock for it.
Solidarity lanes for Ukraine
The volume of Ukrainian exports moving on EU infrastructure has grown again in recent months. The share of Ukrainian non-agricultural exports on the so-called ‘Solidarity Lanes’ have risen from 50% to 80% between April and June. Data for July and August will likely show a further increase of that share after the suspension of maritime services to Odesa.
The Solidarity Lanes are a cooperative initiative that has established new transport routes for Ukraine’s exports and imports. They have helped Ukraine export around 226 million tonnes of goods, such as grain, ore and steel, and import around 108 million tonnes of essential merchandise, including fuel, vehicles, fertiliser as well as military and humanitarian assistance, according to the European Commission. The Solidarity Lanes pass through the Danube region, Poland, the Baltics, and the Adriatic region, via rail, road and inland waterways.