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Three grains carriers sail from Ukraine's deep sea ports

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Three grains carriers sail from Ukraine's deep sea ports

Highlights

Navistar, Polarnet and Rojen sail from Black Sea ports

Prospect of resumption in Ukrainian shipments has pushed down prices

Market still waiting for evidence of inbound ships to Ukraine

Three bulk grains carriers sailed from Ukraine's deep sea ports, Aug. 5, the first such ships to leave since Aug. 1 when the Razoni left Odessa and ended a five-month suspension in exports that had disrupted the global market for wheat and corn.

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That suspension -- a response to Russia's naval blockade and Ukraine's subsequent defensive mining of the waters -- was one of the main drivers behind a surge in global prices for wheat and corn, as supplies from one of the world's largest exporters were taken out of the market.

Russia's invasion left more than 500,000 mt of grains stranded on ships that could not leave Ukraine's deep sea ports. The departure of those ships has been made possible because of a deal brokered by the Turkey and UN which created a "humanitarian maritime corridor" through the Black Sea.

The three ships that sailed Aug. 5 were the Navistar, the Polarnet and the Rojen, which were destined to discharge cargoes of corn in Ireland, Turkey and the UK, respectively.

The UN-brokered deal, signed July 22, has helped bring down global grain prices, and the state grains boards of Algeria, Iran and Tunisia have all bought wheat in tenders in the week to Aug. 5.

Global grains traders were looking for evidence that new ships will enter, load and leave Ukrainian ports. Shipowners' eagerness to recover vessels that have been stranded in Ukraine for five months may not be matched by a willingness to return.

The return of inbound ships to Ukraine's deep sea ports will depend on what insurers charge for the additional war risk premium.

To insure just the ship's hull and machinery may add an additional cost of around $12-$32/mt for a Panamax cargo, shipping sources said.

The Joint Coordination Centre, which is overseeing the shipments, said another ship, the Fulmar S, had been authorized to sail into the Ukrainian port of Chornomorsk. The ship was northwest of Istanbul and awaiting inspection, it said.

Cargill recently sold 11% protein Ukrainian milling wheat on a FOB POC basis into a World Food Program tender, although it was not clear which ship will collect the cargo.