Ukraine’s prime minister, Denys Shmyhal, has announced that a new agreement has been reached to provide war risk insurance for ships sailing in the Black Sea corridor. It is the latest in a series of insurance moves and comes at a critical time after a bulk carrier was hit by a Russian missile in a Ukrainian port.
Without giving details, Shmyhal called the new agreement “strategically important” for free navigation in the Black Sea. His announcement comes as Ukraine is again working to reassure the shipping community in a bid to maintain vital export trade. The corridor, which was launched in August 2023, has allowed Ukraine to export iron ore and metal products in addition to grain, and the prime minister says the new agreement will make the Black Sea corridor more accessible to a wider range of exporters.
“According to the results of the agreements between the President of Ukraine Volodymyr Zelenskyi and the Prime Minister of Great Britain Risha Sunak, Ukraine together with a pool of British insurance companies has formed a special mechanism. It will allow exporters of all products from Ukraine to get a discount on the cost of insurance against war risks,” Shmyhal wrote on social media.
He said a total of 14 British insurance companies had agreed to participate in the effort, which he hailed as the latest step in Western support. He also reported that the World Bank Group’s Multilateral Investment Guarantee Agency (MIGA) has already provided more than $166 million in insurance coverage, with negotiations underway for new projects. The US International Development Finance Corporation (DFC) also recently approved five new projects worth more than $380 million, and Shmyhal said negotiations were underway with the European Bank for Reconstruction and Development (EBRD) for additional trade insurance.
The moves follow reports that the cost of war risk insurance tripled last week after the Liberian-flagged Kmax Ruler was hit by a rocket. It was also seen as driving up freight costs, threatening Ukraine’s exports. The government has reported that it expects to harvest 79 million tonnes of grain and oilseeds this year, with two-thirds available for export.
Despite fears that ships would stop using the corridor after last week’s missile strike, at least three ships left Ukrainian ports today, while three more were seen arriving at Chornomorsk. In addition, at least seven bulkers were at anchor near Sulina, Romania, which is used as a staging point before continuing on to Ukraine.
Ukrainian officials reported yesterday that 100 ships had left Ukrainian ports since the Black Sea corridor was launched less than three months ago. They say 3.7 million tonnes of food and materials have been exported along the corridor.
