The Ukrainian grain, traded at a lower price because of lower costs faced by farmers outside the European Union, would put pressure on the Romanian transport capacity, squeezing out the Romanian producers who would face higher transport costs and thinner, if any, profit margins, Romanian analyst for the Farmers Club Cezar Gheorghe argues in a column published by Ziarul Financiar.

"What does Romania gain out of this? Farms that will go bankrupt with a negative impact on the food security system at the national level, the infrastructure will collapse and will have to be repaired or replaced because this was delayed for decades. The port facilities are managed by [private] companies that essentially make a profit and by no means protect Romania's interests," he argued.

Romania's transport minister Sorin Grindeanu just announced that the public railway company CFR would boost its capacity of shipping Ukrainian grains through Constanta and Galati ports.

Cezar Gheorghe estimates at around EUR 100 mln the planned investments with the purpose of increasing the transport capacity towards Constanta port by 500,000-600,000 tonnes per month. This would already put immense pressure on the existing railway infrastructure, the analyst points out.

Separately, an additional flow of about seven mln tonnes of merchandise per year will put a lot of pressure on the infrastructure of the port of Constanta, and this will negatively impact the access of Romanian goods to the port of Constanta and implicitly to export, the Farmers Club analyst argues. 

(Photo: Denys Kovtun/ Dreamstime)

iulian@romania-insider.com