The situation in Ukraine remains fluid and, with events moving quickly, very little is certain. At the time of writing, attention is focused on the Crimea, with rumours of Russian naval vessels blockading the Kerch Straits, which, if true, would quickly isolate the main port of Mariupol. At present, the US and EU appear committed to achieving a non-military solution to the ongoing crisis. Limited sanctions have been introduced by both, aimed at freezing and/or seizing the assets of persons designated under the sanctions for their involvement in undermining the democratic process in Ukraine or misappropriating assets of the state. No one wants to see any kind of armed escalation, but we can expect a period of uncertainty as Russia decides how it will react.
Ukraine’s importance in terms of wheat and corn supplies is significant. It is also a key exporter of metals and minerals to Europe, Russia and beyond. Ukraine ranks as the world’s fourth and fifth largest exporter of corn and wheat respectively and it is the world’s fifth-largest steel exporter. It is also a vital gateway for Russian natural gas to western Europe, with approximately a fifth of the gas used in Europe flowing across the country. Together with Russia, Ukraine forms the northern coast of the Black Sea, an important shipping route for agricultural products, metals and energy.
The potential disruption for the corn and wheat and gas and steel industries, together with the resulting rise in prices, is causing considerable concern. An escalation of tensions and any military action may have repercussions for ship owners, charterers, crews and insurers alike…
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