- Bearish Ukraine freight: Grain exports are down 28% year-on-year, reducing Black Sea shipping demand, especially on Ukraine–MENA routes.
- Bullish Russian oilseed flows: New flaxseed oil capacity (120,000 tons) and strong sunflower oil positions support expanded export and logistics activity.
- Higher Russian inland costs: Rail freight tariff increases from 2026 will modestly raise export logistics costs for grain and vegetable oils.
- Stable Caucasus demand: Russia’s wheat exports to Georgia hit a four-year high, reinforcing consistent short-haul Black Sea freight.
Ukraine Grain Export Performance
Ukraine’s grain and leguminous crop exports reached 18 million tons as of January 23 in the 2025/26 marketing year, significantly below the 24.867 million tons recorded by January 27 a year earlier. The 6.9 million ton gap translates into a 28% year-on-year decline, signaling weaker seaborne demand from Ukrainian Black Sea ports.
January export activity also softened, with 2.469 million tons shipped versus 2.635 million tons in the same month last year. Corn currently dominates export flows at 8.009 million tons (including 2.044 million tons in January), closely followed by wheat at 8.372 million tons (420,000 tons in January). Barley remains subdued at 1.322 million tons, with only 3,000 tons exported in January, underscoring a sharp drop in this segment.
| Commodity | Total Exports 2025/26 (Mt) | January 2026 (Mt) | Previous Year Reference |
|---|---|---|---|
| All grain & leguminous | 18.000 | 2.469 | 24.867 Mt as of Jan 27 prior year; 2.635 Mt in January |
| Corn | 8.009 | 2.044 | Not specified |
| Wheat | 8.372 | 0.420 | Not specified |
| Barley | 1.322 | 0.003 | Not specified |
The contraction in export volumes is particularly negative for short-sea and Handysize tonnage serving Ukraine–MENA and intra-Black Sea routes. The near standstill in barley shipments suggests weaker demand for Azov Sea and smaller bulk carriers traditionally tied to this trade.
Russian Vegetable Oil Expansion
Russia is broadening its vegetable oil export profile following the commissioning of two flaxseed processing plants in 2025. According to Agroexport head Ilya Ilyushin, the country can now supply up to 120,000 tons of flaxseed oil annually, valued at around $120 million, with a strategic focus on China and Chile and broader South American demand.
Alongside flaxseed oil, Russia is consolidating its leadership in sunflower oil. The country currently accounts for 36% of global sunflower oil exports and expects this share to climb to 40% in the current season. Russia’s market penetration is particularly strong in key destinations: India (55% of imports), China (78%), Egypt (42%), Iran (92%), and Turkey (68%).
This expanding oilseed portfolio, including an identified 800,000-ton opportunity in African markets, underpins additional demand for bulk liquids and containerized logistics. New flows from Black Sea, Azov, and potentially Baltic ports are likely to support tanker utilization and port infrastructure throughput despite moderately higher inland costs.
Russian Rail Tariff Outlook
The Federal Antimonopoly Service has proposed a 1.01 coefficient increase on Russian rail freight tariffs from March 1, 2026, through February 28, 2027. This implies a 1% rise in base freight rates, intended to fund enhanced transport security measures across the rail network.
In addition, a separate 1.1 coefficient on empty rolling stock will apply from January 1, 2026, effectively imposing a 10% surcharge on the movement of empty wagons and containers. For grain, oilseed, and vegetable oil exporters, these adjustments will marginally increase inland logistics and repositioning costs, slightly narrowing export margins but not fundamentally undermining Russia’s competitiveness in core markets.
Russia–Georgia Wheat Trade
Russia’s wheat exports to Georgia surged 35.1% in 2025, reaching 405,000 tons with a total value of $102.3 million. This marks a four-year high and confirms Russia’s near-monopoly position in the Georgian wheat market, where it commands approximately 99% of import volume.
The robust Russia–Caucasus grain corridor supports consistent short-haul freight demand through the Black Sea and adjacent routes into early 2026. Stable offtake from Georgia provides a floor for regional export programs even as Ukrainian flows contract.
Freight Market Implications
The 28% decline in Ukrainian grain shipments is broadly bearish for Black Sea dry bulk freight, particularly on Ukraine–MENA lanes and barley-linked Azov Sea trades. Conversely, Russia’s expanding vegetable oil exports and resilient wheat flows to Georgia and other buyers are neutral to modestly supportive for Russian-origin logistics, offsetting some regional weakness.
Looking into 2026, the incremental rail tariff increases in Russia will slightly elevate inland logistics costs but are unlikely to materially reduce export volumes, given Russia’s entrenched market share in key grain and oilseed destinations.
Source: Market Data
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