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Ukraine's Cabinet of Ministers has approved an expansion of the list of agricultural commodities eligible for extended settlement deadlines on export-import transactions overseen by the National Bank of Ukraine. Under the new rules, companies may apply to the Economy Ministry to have payment deadlines extended by up to 180 days.
The list of qualifying goods covers the country's main grains and oilseeds — wheat, rye, barley, oats, corn, soybeans, rapeseed and sunflower seed. It also includes soybean, sunflower, rapeseed and mustard oils, oilcake, and a range of other agricultural products.
The Agriculture Ministry said the measure was necessary because logistical disruptions have significantly lengthened delivery times. According to the ministry, transportation times for agricultural goods have increased by 40 to 50 percent, complicating the execution of foreign trade contracts and the timing of export proceeds.
In August, Ukraine managed to export only 33 percent of the required volume of agricultural products as restrictions on seaport operations bit, according to Agriculture and Food Minister Taras Vysotskyi. Exporters were forced to lean more heavily on Danube ports, rail networks and road routes across the western border, but those channels have limited capacity, and additional transshipments have further extended delivery schedules.
The government's move is designed to reduce the risk of financial penalties for exporters when delays in receiving export revenues are caused by logistical factors beyond their control. Extensions will not be granted automatically; each request will be reviewed by the Economy Ministry following a formal application from the Ukrainian exporter.
Source: UkrAgroConsult