quote:
Russia’s new drive to crush Ukraine
Moscow’s relentless offensive on cities and ports has halted the country’s grain exports, severing an economic lifeline
As a glorious summer draws to a close, across the Ukrainian steppe silos are brimming with a bumper harvest. For farmers such as Volodymyr Varbanets, who has worked the same stretch of land since the 1970s when it was a Soviet collective farm, it should be a season to celebrate. Yet it is not.
Thanks to Russia’s ferocious new bombing campaign against ships on the Black Sea and Ukraine’s cities and ports, the mounds of barley, sunflower seeds and wheat in Varbanets’ giant barn are stranded. Increasingly the grizzled 76-year-old fears his crop will end up rotting where it lies.
“I just cannot sell it,” he shrugs, adding that some farmers in his region are in a far worse plight. “People are storing grain outdoors under tarpaulins or selling it at depressed prices just to survive.”
The scene of thwarted abundance, mirrored at farms across Ukraine, reflects a dramatic shift in momentum in the four-and-a-half-year-old conflict. It has grave implications not just for global food supplies but for Ukraine’s economy, its survival strategy and potentially the course of the war.
Ukraine’s drone strikes on targets in Russia early this year emboldened some of Kyiv’s allies to be cautiously optimistic about the war. But since July Russia has unleashed a furious response: a ruthlessly targeted air offensive that has closed the Black Sea to shipping, blocking Ukrainian exports’ main route to market. Not only has it cut off an economic lifeline to the rest of the world, it is linked to a broader campaign to throttle the economy and crush Ukraine.
Night after night, jet-powered drones and missiles are pulverising infrastructure in the Odesa region — and the capital Kyiv — targeting especially the electricity grid to bring the two cities to their knees.
The devastation underlines Ukraine’s critical shortage of air defences, in particular US-made Patriot missiles, which has left the authorities frequently unable to ward off Russian attacks. Most mornings Odesa awakes to the sight of a plume of smoke in the sky from the latest overnight hit.
Oleh Kiper, head of Odesa’s regional military administration, says they are doing everything they can to repel the attacks and reopen the Black Sea corridor but, he adds bluntly, “pauses and delays” in allies’ weapons deliveries are ultimately responsible for the ports’ closure.
“First the Russians concentrated on substations. Now they have expanded their targets,” says Tymur Samosudov, the National Guard commander in charge of a drone-interceptor unit at the heart of the region’s defences. “They are also hitting storage depots and warehouses to ram home the psychological pressure; and by blocking the grain they maximise economic damage.”
With both Russia’s and Ukraine’s grain exports all but blocked, the world may soon have to take note as food prices rise. Before 2022, according to the UN, Russia and Ukraine accounted for a third of global wheat exports and 20 per cent of corn. Distracted by the war in Iran, world leaders have been slow, Ukrainian officials say, to focus on the coming crisis.
“This affects not just our region’s economy but Ukraine’s and the world’s,” says Kiper, speaking minutes after the latest air raid siren resounded through the city. “We used to supply about 70 countries and 300mn people with our agricultural products. This is a global crisis — and will soon be felt around the world.”
For now though, it is being felt much more acutely in Ukraine.
A calamity for Ukraine’s finances
Ukraine’s Black Sea ports are the traditional beating heart of its economy. Before Russia’s all-out invasion in February 2022, they shipped more than 90 per cent of Ukraine’s overall exports of 60mn tonnes of grain a year. In the three years before the July offensive, several hundred ships a month docked at Odesa’s three deep-water ports.
Now they are motionless — except for a handful of stevedores exploiting lulls in the fighting to patch up the damage and frantically unload cargoes from ships hit at their moorings.
“It’s not just a risk for ships now, it’s a guaranteed risk,” says Kostiantyn Tymoshenko, general manager of the shipbroker Formag, looking out over the burnt-out shell of the Hotel Odesa, which was hit earlier in the war.
Just 12 hours after the interview, a ship carrying the flag of Antigua and Barbuda was hit by Russian drones just outside the Chornomorsk Port, 12 miles south of the city, killing the captain and setting the vessel on fire. Russia’s Ministry of Defence said it had been delivering military cargo to Odesa and was hit as part of its campaign to target ships bringing arms to Ukraine.
July was the most dangerous month for shipping in the Black Sea since February 2022, according to Lloyd’s List in August. The combination of Ukrainian strikes on Russian shadow fleet tankers and naval ships and the Russian offensive on Odesa meant, it added, that the Black Sea and not the Strait of Hormuz was the deadliest theatre for commercial shipping.
This is a calamity for Ukraine’s finances. The huge extra expense of transporting grain by truck means only a trickle will make its way overland to the outside world. Taras Vysotskyi, the minister for agriculture, estimates that if the ports stay closed Ukraine will forfeit at least $8bn between June this year and June 2027. Such a shortfall would amount to 20 per cent of last year’s overall export revenue.
Ukraine would have expected to export 64mn tonnes of agricultural produce this year, he says, but it will be lucky to achieve half that if the ports do not reopen. Some think it will export far less.
Odesa, however, has a more immediate concern. Overshadowing every conversation with officials, businesspeople and residents is the fear that Russia is determined to make this winter, the fifth since the full-scale invasion, the toughest yet.
“I’m worried not only about the winter but the people who live here,” says Kiper, the head of Odesa’s military administration. “The enemy is not waging war against the military but a different kind of war.”
The new urban front line
In the past three years the fighting in eastern Ukraine has become largely static, with a 20-30km-deep “kill zone” dominated by drones. But in cities far from the trenches, such as Odesa and Kyiv, the front line is more fluid as Russia unleashes jet-powered drones, which are harder for interceptor drones to destroy than the slower models of the first years of the war.
Few have more sobering insights into the raw power of this campaign than Shota Khajishvili, owner of the Risoil terminal at the Chornomorsk Port. He founded his company as a sunflower oil factory after the fall of the Soviet Union in 1991 and has since built up a port empire, which before the war loaded 5mn-6mn tonnes of agricultural goods a year.
Now he presides over a wasteland of crumpled metal that looks as if it has been struck by a series of tornadoes. All his cranes and many of his grain silos have been damaged. Two of his giant sunflower oil containers overlooking the docks were hit, leading to a flood oozing down into the harbour.
“Nothing is happening here,” he says. “We had a few small six-tonne tankers a few weeks ago, and now nothing. No one will insure people’s lives here now.
“The Russians have changed tactics. They were using single drones. Then three or four at a time. Now sometimes they use many more for a single target. The scariest thing is they have started to bomb us with huge aviation bombs with wings; they are very hard to hit.”
He rebuilt his headquarters after it was blown up by a missile, but soon after the new building opened it too was hit. He still goes to work at 7am every morning, but he has a concrete bomb shelter beside his makeshift office, for when the air raid app on his phone signals an imminent strike.
The day before there were 28 air raid alerts. Such is the damage, Khajishvili says, that if his ports reopened tomorrow they would have only 30 per cent capacity. “We used to be able to have five vessels loading simultaneously. Now we could cope with just two.”
The stoppage is even more acute than in 2022 when the Black Sea was closed after the February all-out attack. Five months later, after Russia’s fleet incurred heavy losses from Ukrainian missiles and drones, Moscow agreed to a UN-mediated Black Sea Grain Initiative, opening the sea to commercial traffic. Russia renounced the deal in 2023 but until July this year Ukraine’s ports have been able to keep operating albeit at lesser intensity than before the war.
A critical difference between 2022 and now, say Ukrainian officials, is that four years ago Russia relied mainly on sea mines for the blockade and did not have drones. So ships were able to ferry cargo to and from freshwater ports in the nearby mouth of the Danube. But now drones are targeting ships there too.
Even if the ports reopen, it is not clear how the cargo will be ferried to the docks. In recent weeks the Russians have stepped up their attacks on trains used to transport the two bulkiest and most valuable exports, iron ore and grain. “We have lost three locomotives in our port area alone,” says Mykyta Hrubov, the executive director of the TIS private port, at the deep-sea port of Pivdennyi, 25 miles east of Odesa. “There is a big shortage now, this is a weak point for us.”
Vysotskyi, the agriculture minister, says they are almost out of reserve locomotives. He is in talks with European allies who have the same railway gauge about providing fresh stock.
All the while port owners — just as the farmers — are running out of money and worried they will have to lay off workers. “The city’s economy revolves around the ports,” says Khajishvili’s son, Tariel, a shipping broker. “When they shut down, much of the population is left without a job.
“The Russians are trying to win the war by hitting us behind the front lines. They are targeting the lives of civilians to force us to surrender by leaving us without heating, water or jobs.”
The two men fighting to keep Odesa alive
In the coming months of winter, the city will be increasingly reliant on two men: Samosudov, the commander of Odesa’s drone interceptor unit, and Dmytro Hryhoriev, head of the region’s embattled electricity distribution network.
The 36-year-old Samosudov commands a team of 25 young men, veteran drone pilots who have served on the front line and have a record of about 200 hits each. They operate in a secret location in Odesa, dominated by a giant map of the Black Sea, controlling interceptor drone launch pads located across the region.
In their dark T-shirts they stare at screens; to an untutored eye, they look like video gamers. Their unit logo is a digital mock-up of Themis, the Greek goddess of justice, holding her famous set of scales.
“We have a broad overview of the battlefield in the sky,” says Samosudov. “We can see their missiles and drones being launched. We get around two hours’ advance warning and don’t react immediately because sometimes they just fly around. When they get close to our waters, we act.”
They tend to deploy two interceptor drones for each incoming Shahed, the low-cost attack drone originally made in Iran and now produced in Russia. They claim a 95 per cent success rate in downing Shaheds, but the new jet-powered Shaheds are faster and require fighter jets to shoot down.
“They are a problem,” he says. “We have had instances of hitting them with our interceptors, but it was more luck than anything else.”
His unit is a microcosm of the funding problem facing Ukraine’s defenders. The state provides 40 per cent of its finances and private donors make up the rest, but they are always in need of more. “There is no shortage of drones being produced, we just need the finances to buy them — and missiles to take on jet-powered drones and missiles.”
Their most intense night was September 14 when he says more than 150 Shaheds and Gerberas, cheap Russian drones, entered their airspace. “It was an eight-hour battle without pause.”
But some inevitably get through — and most that do are targeting substations to try to cut the electricity supply.
Hryhoriev, head of the Odesa branch of DTEK, the private company responsible for the electricity network, has possibly the hardest job in the city. He looks and sounds exhausted. Last winter, he says, the Russians attacked more than half the big substations in the region, some two or more times. Fifty transformers were destroyed.
“We have had no let-up in attacks,” he says. “We have done a lot of work to prepare for winter and for now everyone has electricity, but the best protection is air defence.”
Oleksii Miaskovskyi, director of the Port of Odesa, in the heart of the city, says businesses have learnt to adapt but that they all know it will be a “difficult” winter. “We have generators but they are expensive, cannot work all day long and cannot replace the energy system.”
Substations are so huge that you cannot hide them completely, says Hryhoriev. As for replacing destroyed ones, he says even in peacetime it took about two years to build a new one; and mending the damaged ones is out of the question given the constant interruption of air raid sirens and attacks.
“Unfortunately the enemy learns as well. They learn that if the missile they sent yesterday wasn’t effective, they send another one.” He ends the interview vowing to do all he can to keep the power going. The following morning one of his workers is killed by a Russian drone.
‘We just have to get through this bad winter’
For now the race is on to safeguard the harvest — and see if there is any way of opening up the Black Sea.
Vysotskyi, the agriculture minister, believes as many as 11mn tonnes of crops may lack storage facilities. He has raised $15mn from Ukraine’s allies for giant polymer “sleeves”, which can protect about 200 tonnes of grain and can be erected on fields.
The World Bank is providing a low-interest $250mn loan to help compensate farmers for interest on agricultural loans, but the minister is aware this is just a temporary solution.
As for a repeat of the 2022 grain deal, which opened up the Black Sea, this seems unlikely. Vysotskyi says they are in contact with their allies and the principal buyers of their crops, such as Egypt, Turkey, other countries in the Middle East and India, but Russia has rejected proposals for a maritime ceasefire.
So the farmers of Ukraine’s fabled “black earth” can but pray and wait. Nika Viknianskyi, who oversees a 7,000-hectare megafarm 50 miles north-west of Odesa, has 25,000 tonnes of crops in storage already. This year’s wheat yield per hectare has shot up 40 per cent, he says, but the price has plunged from $220 to $130 a tonne.
“We invested in high tech, but it doesn’t matter how effective you are if you can’t sell your crops,” he says as he conducts a tour of his food mountains — and of the local railway station, which has been hit by Russian drones.
Remarkably, in Odesa most mornings life seems to carry on pretty much as usual, however disrupted the night may have been. Many businesses in the past four and a half years have been remarkable case studies of stoicism and versatility.
“The new port crisis hasn’t been a crazy shock,” says Katerina Baliutova, the director of a container business. “Our bad experience in 2022 helped us to rethink our business. We were prepared.”
The doughty old farmer Varbanets, too, remains phlegmatic. He disappears into a shed and comes out bearing the remains of a rocket, and some shrapnel. He throws them almost triumphantly on the ground. “Our forces are constantly defending the sky above us. Rockets and drones are falling on our fields, but we have not been harmed.”
Everyone knows, however, that tough times lie ahead. “We just have to get through this bad winter,” says Varbanets. “People will survive in the villages no matter what. Even if the electricity goes, we have wood.
“But in the cities it will be very difficult.”