Ukrainian oilseed processing plants are facing the risk of temporary production shutdowns due to delays in vegetable oil shipments. According to the industry association Ukroliyaprom, processing facilities have limited storage capacity for finished products, with tanks generally sufficient for only 5–7 days of continuous operation. If oil is not dispatched on time, plants may have to suspend production lines and stop accepting oilseeds from agricultural producers.
One of the main challenges is insufficient coordination between railway transportation and seaport operations. The association emphasises that vegetable oil is transported in specialised tank wagons, which cannot replace grain hopper wagons. Therefore, oil transportation does not reduce the number of wagons available for grain, although both types of cargo require locomotive capacity. According to Ukroliyaprom's estimates, one train carrying vegetable oil can generate foreign exchange earnings and tax revenues equivalent to 4–5 grain trains.
Additional difficulties arise at seaports. Specialised tankers transporting edible vegetable oils may face extended waiting periods at anchorage due to delays in pilotage services or convoy formation. This increases freight and demurrage costs and makes it more difficult to attract shipping operators. At the same time, liquid bulk terminals and grain berths handle different types of cargo, meaning their operations can be organised in parallel.
To address these challenges, Ukroliyaprom proposes two main measures: introducing coordinated railway schedules for vegetable oil shipments and ensuring timely access for specialised tankers to port terminals. Stable processing operations are also important for farmers, as oilseed crushers provide regular demand for sunflower seed. When finished oil shipments slow down, processors may reduce raw material purchases, potentially putting additional pressure on domestic prices and complicating sales of the new harvest.
Original source: Ukroliyaprom Association