Ukraine: has officially halted operations in its large Black Sea deep seaport Yuzhny declaring force majeure. Yuznhy exported 25 MMT of iron ore last year (2% of global supply). Market participants said vessel movements in and out of all Ukrainian Black Sea ports have ceased. Many shipowners expressed unwillingness to commit vessels into the Black or Baltic Sea. Not only iron ore, but grains, coal and minor bulks are also impacted by the halt in operations. There are a lot of enquiries from the usual customers of Black Sea dry cargo volume about buying commodities from other destinations. However, it is doubtful whether the rest of the world can swiftly and easily substitute the export volumes now lost from the Black Sea. This was clearly reflected yesterday, as iron ore, coal and grains prices rose markedly.

Russia: exported 165 MMT of coal last year (20 MMT from the Black Sea). Russia also exported 8 MMT of Fertilizers, and 22 MMT of Wheat. Other parts of the World cannot make up for these volumes in the event of direction sanctions on commodity exports. So, we think the impact for dry bulk markets overall will be limited but expect disruptions and changes to trade flows.