Ascot and Marsh insure grain ship from Ukrainian Black Sea ports

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Aug 23 (Reuters) – Broker Marsh (MMC.N) and insurer Lloyd’s of London (SOLYD.UL) Ascot said on Tuesday they had covered a ship carrying grain and foodstuffs from Ukrainian ports in the Black Sea under its new Marine Cargo and War Insurance Facility.

Launched last month, it offers coverage of up to $50 million for vital Ukrainian food supplies shipped through safe corridors established by the recently signed Black Sea Treaty.

The cover adds great protection to the agreement between Moscow and Kyiv in late July, which was brokered by the United Nations and Turkey and resulted in the unblocking of three Black Sea ports. Read more

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The total number of ships that left Ukrainian Black Sea ports under the deal reached 27, and two more ships left the Ukrainian port of Chornomorsk on August 20, according to the Turkish Defense Ministry. Read more

“Cargo and war insurance will play a central role in the wider resumption of exports of grain and other vital foodstuffs from Ukraine’s Black Sea ports,” said David Roe, Head of UK Cargo, Marsh .

Grain shipments from Ukraine since the war with Russia have been hampered as its Black Sea ports, a vital route for shipments, were closed, driving up food prices and raising fears of shortages in Africa and the Middle East.

Until this facility was launched, insurers were willing to cover grain out of Black Sea ports only with international naval escorts and a sea mine countermeasures strategy.

However, the cost of hedging for these war-exposed businesses is not cheap. Bounties for going to the Greater Black Sea region have risen sharply to 5% of the ship’s value, up from 0.025% before the invasion.

Marsh and Ascot said they would extend the facility to clients of Lloyd’s of London registered brokers.

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Reporting by Noor Zainab Hussain in Bengaluru; Editing by Arun Koyyur

Our standards: The Thomson Reuters Trust Principles.

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