Posco International’s grain export terminal in Ukraine (Posco International)
After a months-long supply disruption due to the war in Ukraine, Posco International said Thursday that it has partially resumed operation of its grain export terminal located in the country’s eastern border area.
According to the company, its operation resumption follows its clients’ request for supply. Some 2,000 tons of wheat have been exported its terminal in Mykolaiv this week, where some 115,000 tons of grains including wheats and corns are stored. Transportation of grains was conducted via roads, as offshore supply route has been blocked following the Ukraine authorities’ closure of ports in the Black Sea.
Posco International shut down its grain export terminal in February following Russia’s invasion of Ukraine. All of its Korean employees in Ukraine office have returned to South Korea, but keep in close communication with the local workforce to manage the facility, the company said.
Considering the fact that the Russia-Ukraine war has gone on longer than expected, and most embassy employees from major countries have returned to Kyiv, the company said it will gradually expand shipment and transportation of grain via overland routes.
“July and August are the most significant months that decide Ukraine’s grain harvest. To minimize the impact to the industry, our plan sticks to offering stock and storage service for wheat and corn harvested in the southern region,” said Posco International.
With resumption of its value chain, the South Korean trading company said it will also push ahead with collaboration with ag-tech companies to respond to stable procurement system as well as changing agricultural trends globally. It also plans to strengthen its value chain by linking farming, storage, processing and transportation, and create profit to increase its presence in the global grain market.
After opening a grain export terminal in 2019, Posco International has exported over 2.5 million tons of grain to countries in Europe, North Africa and Middle East. For the first time, it supplied Ukrainian wheat to South Korea in 2020, making the first Korean firm to import grain from overseas terminal it owns.
Hoping to expand its food business to become one of the world’s top 10 food trading companies amid growing concerns over rising food prices, Posco International said it aims to increase sales to 10 trillion won by 2030, trading some 25 million tons of grain annually.
According to Posco International, Korea’s grain self-sufficiency rate is only 21 percent, as the country produces 4.5 million tons of grain a year and imports about 16 million tons annually to satisfy demand.
Aside from rice, the country is heavily reliant on imports of other staples such as wheat, corn and beans. Countries that have low self-sufficiency rates are inevitably affected by the production levels of exporting countries and by price fluctuations, Posco International explained.
The company currently also runs a palm oil business in Indonesia and a rice processing complex in Myanmar.
By Kim Da-sol (firstname.lastname@example.org