The surging oil and gas prices coupled with the geopolitical risks arising from the conflict are bound to cripple global supply chains, especially in the energy-intensive logistics sectors. Russia and Ukraine are major suppliers of fertilizer and the land destruction and commercial constraints due to the war have brought a major export concern for the fertilizers and in turn food and grains.Similarly, the household stockpiling of several products led to a shortage and the recently created shipment crisis deepened the crisis The cost of fertilizers, mainly for crops and animal feed, was already high due to increased demand during the pandemic.The prices of soybean, corn and crude oil – of which Russia is the leading producer – have been increasing ever since the attack.In Europe, natural gas prices rose by around 120-130% in the 6 months since the start of the war, while coal prices rose by 95-97% during the same period.The uncertainty has had a snowball effect on supply chains across the globe. Despite the deal, Russia attacked Odesa's seaport with cruise missiles hours after signing the deal. However, in July, Russia and Ukraine signed a United Nations (UN) deal to unblock Ukrainian grain exports from three Black Sea ports to ease shortages. The Black Sea and Azov Sea had been blocked by Russia, and the Ukrainian grain shipments were hijacked in the early months of the attack.
Russia has been destroying Ukraine’s agricultural infrastructure, thereby disrupting the entire supply chain.
The war impeded the flow of goods, fuelled cost increases and product shortages, and created catastrophic food shortages around the globe. The effects of the pandemic on warehouse capacity and container availability had just recently started fading when the Russia-Ukraine war started impacting the industry. The Russia-Ukraine conflict has affected the global logistics market on every level.
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