Ukrainian grain exporters report a significant loss of positions in wheat markets across Asian and African countries. The main reason behind this trend is the redirection of most export volumes toward the European Union, reports Baltimore Chronicle with reference to Latifundist.
According to Promising International Trading Co. DMCC, Ukraine has lost around 70% of its wheat exports to Egypt. The shift in export focus not only led to missing a profitable sales window but also resulted in a decline in trust from Egyptian buyers.
A similar trend is observed in Tunisia, where 75% of imported wheat now comes from Russia, and a portion from France, while Ukrainian wheat is nearly absent from the market. Ukraine has also lost ground in Sudan and Ethiopia.
Compounding the issue is the quality of the grain. Many African countries, including Kenya and Nigeria, demand wheat with a high protein content of 12.5%, a specification that Ukrainian wheat rarely meets, reducing its competitiveness.
Representatives of TAS Agro noted that Russian trade diplomacy is actively operating in these markets. If the importer requires wheat with 12.5% protein, Russian suppliers are present — while Ukrainian ones are not. According to them, Russia uses flexible financial mechanisms, engages in barter deals, actively trades with India in rupees, and strengthens cooperation with China. These strategies allow Russia to hedge risks associated with potential trade restrictions or currency access.
Ukrainian traders also face difficulties in Asia, specifically in markets such as Indonesia and Bangladesh. There, Russia is aggressively pushing out competitors using price dumping and alternative payment schemes.
Traders point out that Russian suppliers are ready to work on deferred payment terms, whereas Ukrainian companies generally insist on payment immediately after vessel loading.
According to Latifundist, due to new EU restrictions, Ukrainian exporters will be forced to lower prices and revise their logistics models. While previously traders could pool small grain shipments for export to Europe, they will now need to focus on sending larger quantities.
Earlier we wrote that trade visa-free regime with the EU ended.