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Tuesday, April 23, 2024

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Thai fresh products impacted by the Russo-Ukrainian war

Trade authorities have indicated that international sanctions imposed against Russia over its military operations in Ukraine are beginning to impact Thai fresh products exports.

Kittinan Yingcharoen, director of the Office of Foreign Trade in Moscow, confirmed that several Russian commercial and freight airlines including Aeroflot, S7 Airlines, and Ural Airlines – have already halted most international flights. Only flights for Belarus remain unaffected. Plus all the major seaport of Russia is closed right now as a result of the blockade and embargo put by the western alliance meaning the only way to transfer goods to Russia is through air transportation.

The director said the move has significantly affected Thai exports of perishable goods, which require the fastest logistics routes possible. One solution would be to ship the goods on middle eastern airlines, such as Emirates, Qatar, and Etihad. However, these goods would need another connecting flight to reach Russia, which would take more time and increase the risk of spoiling in transit.

Several exporters have already opted to halt exports to Russia altogether, citing higher costs, the instability of Russian currency, and hurdles to conducting business transactions in Russia due to sanctions.

Data from the office of the permanent secretary for the Ministry of Commerce showed Russia imported US$5.9 million worth of fresh Thai fruit and $2.83 million of frozen vegetables.

Kittinan recommended that exporters weigh the risk factors and reconsider exporting goods to Russia at this time until the conflict is resolved or direct flights between Thailand and Russia can resume.

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