Marine sector providesfood security for Ukraine
4 Березня, 2025
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Ukrainian seaports processed a record 97.2 million tons of cargo in 2024, surpassing the 2023 figure by 57 per cent, according to the Ministry for Communities and Territories Development of Ukraine. Agricultural products accounted for approximately 60 million tons of the total volume, underscoring the key role of ports in the export of Ukrainian agricultural goods. In total 88.1 million tons of cargo were exported by sea, compared to 56.2 million tons in the previous year.
9,061 vessels passed through the Ukrainian maritime corridor in 2024. Of these, 4,651 vessels arrived at Ukrainian ports and 4,410 departed for ports in other countries, as reported by the press service of the Ukrainian Navy. This volume of exports is crucial for supporting the country’s economy and ensuring global food security, as nearly 80 per cent of cargo is transported by sea.
Navigation safety was ensured by ship crews and Navy divers, who destroyed a significant number of drifting mines and prevented any vessel detonation incidents in the ports. Additionally, the Naval Forces continually escorted cargo vessels.
Blocking Ukraine’s access to the sea and preventing maritime trade is part of Russia’s strategy in the current war. Attempts to limit Ukraine’s maritime capabilities were made even before the full-scale invasion. However, Ukraine has managed to maintain the operation of the maritime corridor to the ports of Greater Odesa (Odesa, Chornomorsk and Pivdenny), largely due to the efforts of the Ukrainian Armed Forces, which have dealt significant blows to the Russian Black Sea Navy Fleet.
“Russian forces continue their attempts to disrupt Ukrainian ports’ operations. They persist in attacking the ports with drones and rockets, but the air defense system is proving effective. When alarms sound, ports cease operations and all workers seek shelter. Naturally, this negatively impacts operations”
Many saw the targeted missile strikes on Ukrainian ports and ships docked there in the autumn as evidence of Russia’s attempt to render Ukrainian maritime exports impossible – whether through outright destruction or by intimidating shipowners, increasing logistics costs and reducing Ukraine’s competitiveness in the global market. Nevertheless, the maritime corridor continues to operate.
It should be noted that, at the beginning of the war, the industry suffered significant losses due to infrastructure and logistical challenges. The situation was more or less stabilised only in 2023. A positive signal in 2024 was the restoration of container traffic from the ports of Greater Odesa. Since the beginning of the year, Ukraine has unloaded 300,000 containers across all available routes. Looking ahead, the forecast remains unchanged: one-third of container cargo is transshipped in Ukraine, while two-thirds is handled by ports in partner neighbouring countries.
Until the end of 2023, apart from the Danube ports of Izmail and Reni and the land borders, there were no other options for transporting goods, which gave a significant boost to the development of intermodal transportation.
The Ukrainian corridor is considered one of the greatest achievements in the maritime industry since the full-scale invasion. As known, on 17 July 2023, Russia officially withdrew from the Black Sea Grain Initiative, after which, on 8 August 2023, Ukraine announced new temporary routes for civilian vessels in and out of the ports of Greater Odesa. Since 10 August coastal warning No 122/23 has been in effect, defining vessel movement routes.
The stable operation of the Ukrainian corridor is ensured by the Ukrainian Navy, the State Border Guard Service, the Maritime Search and Rescue Service and the Ukrainian Sea Ports Authority (USPA). It is USPA that coordinates all vessels in accordance with special procedures, as well as mandatory orders and the customs code for the respective ports.
Vessels flying the Russian flag, those associated with Russian individuals or legal entities, vessels owned by sanctioned persons, or violators are not allowed to use the corridor. Vessel movement occurs exclusively in convoys, based on prior applications from maritime agents and according to the daily convoy formation plan.
The Joint War Committee has included Ukrainian territorial waters in the list of dangerous zones for navigation (JWC Listed Areas), meaning that for shipowners heading to Ukrainian ports, insurance against military risks and providing guarantees for potential damage reimbursement are critical.
Military risks are not covered by standard protection and indemnity (P&I) and hull and machinery (H&M) insurance policies, so when planning a vessel’s entry into a Ukrainian port, the shipowner must purchase additional extra war risk insurance (EWRI) to cover damage or loss of the vessel. After Russia’s withdrawal from the Grain Initiative, the market expected the additional insurance premium to rise to 5 per cent of the vessel’s value, which nearly completely undermined the economic feasibility of the trip. However, in November 2023, Marsh McLennan, together with the Ukrainian government and Lloyd’s, announced a major expansion of its Unity insurance facility. Unity now provides affordable war risk insurance for ships carrying all non-military cargo – such as iron ore, steel and containerised shipping – and underpins Ukraine’s wider maritime export ecosystem.
The total coverage under P&I and H&M policies amounts to US$50 million, which allows setting the EWRI rate at an acceptable level of 1.25 per cent. The programme involves Ukrainian banks Ukreximbank and Ukrgasbank, which provide reserve letters of credit (bank guarantees), confirmed by Germany’s DZ Bank.
In terms of the challenges and risks we face, what we saw in 2024 is likely to occur in 2025 as well. Russian forces continue their attempts to disrupt Ukrainian ports’ operations. They persist in attacking the ports with drones and rockets, but the air defense system is proving effective. When alarms sound, ports cease operations and all workers seek shelter. Naturally, this negatively impacts operations.
Recently, Russia has focused primarily on rocket and drone attacks on Ukrainian energy facilities. One of the objectives of such actions is to disrupt or significantly hinder the functioning of the maritime corridor. The operation of ports, elevators and terminals requires significant amounts of electricity.
“Logistics companies must adapt to new challenges and seek innovative solutions. This creates new opportunities for the development of the industry and the enhancement of logistics efficiency in Ukraine”
Mines also remain a significant threat. In the past two years, more than 50 sea mines have been washed up on the Romanian coast. There have also been dozens of incidents where mines washed up on the shores of Ukraine and other countries. This issue is expected to be addressed by the recently established mine-sweeping group, involving Turkey, Romania and Bulgaria.
Unfortunately the ports of Mykolayiv and Kherson are located near the occupied territories and port calls are not possible now. A number of vessels have been blocked in these ports since the start of the war.
Despite the difficulties, logistics in Ukraine shows development potential. The war has led to an increased demand for logistics services, creating new opportunities for logistics companies.
The state of logistics in Ukraine in 2025 remains complex and dynamic. Logistics companies must adapt to new challenges and seek innovative solutions. This creates new opportunities for the development of the industry and the enhancement of logistics efficiency in Ukraine.
