Sadly over 75 years of peace on the European continent came to an end yesterday, with the invasion of Russian troops in to the country of Ukraine.
As the situation evolves, Ukraine has declared martial law and thousands of people are fleeing from their homes and towns, heading for safety toward many neighbouring borders. Men of fighting age are being conscripted to defend their home nation, whilst many men and women who have been working abroad are returning home to fight. Our thoughts and prayers are with the people of Ukraine.
As a consequence, carriers and shipping countries have stopped activity in the country until further notice. Whilst there may not be direct trade routes to Ukraine it will most definitely have an impact on the supply chain in Europe.
In recent years, an increasing number of trucks being driven around Europe are driven by Ukrainians. With those young people having to go back to Ukraine, their driving seats will need to be filled. We are all aware of a severe shortage of drivers across the world and in Europe in particular, and this will further significantly add to limited vehicle availability.
Trading Statistics from Sheffield Chamber of Commerce
In general, trade between the UK and Ukraine to the year-end of Q2 2021 was £1.6bn in total. Four fifths of this in goods, with imports of:
- Iron and steel (about a quarter of all Ukrainian goods imports to the UK)
- Cereals and grains (22%)
- Vegetable oils and fats (15%)
- Oil-seeds/oleaginous fruits (14%)
- Animal feed (3%).
Key UK exports to Russia are machinery:
- Nuclear reactors, boilers ($743m in 2020)
- Vehicles ($504m in 2020)
- Pharmaceuticals ($293m)
- Electrical & electronic equipment ($153m).
The combined effect of increased gas and oil prices, disruption in supply chain movements, restrictions in supplies and tightening of cash flows will undoubtedly affect the flow of business with Europe. IFS will be monitoring the situation and government guidelines on a regular basis. If you need any advise in relation to booking your shipments to Europe, please do not hesitate to get in touch.
We feel it is right, to take this opportunity to inform you of these economic factors, but our overwhelming thoughts are for the Ukrainian nation during these worrying times.
