Lukisia to end its relationship with Belarus fertilizer exports

The government told the state-owned Lithuanian Railways, LTG, to end its relationship with US-sanctioned Belarusian potash giant Belaruskali, that it exports around 11 million tons of fertilizers annually via Biriu Kroviniu Terminalas Bulk Cargo Terminal, BKT.

The government expects to draft amendments to the Law on International and Economic Sanctions by the end of January to prevent any possible transit of these fertilizers through Lithuania. If the Cabinet approves the legislation in February, the parliament will vote on it in a fast-track procedure.

The mayor of Klaipeda, Vytautas Grubliauskas, sees possible redundancies as a key loss for the port city resulting from the measure.

The biggest loss would be the job losses in the directly affected stevedoring companies, he told BNS. Highly valued and well-paid positions are well-paid for highly skilled professionals. We don't have any specific figures, but it is said that it could be from several dozen to several hundred. The mayor said that the measure will affect Lithuania as a whole, as revenue from Belarusian fertilizer shipments will not have a direct impact on the city's budget.

He noted that what is bad for the state is bad for the city.

Vaidotas Sileika, president of the Association of Lithuanian Stevedoring Companies, said it is not easy to predict how a halt to transit shipments will affect the port in the near future. He thinks that the entire transport and logistics sector, including the port, will have an impact.

Sileika believes that BKT will be able to handle other cargoes if fertilizer shipments via Klaipeda stop.

It can handle agricultural products and other bulk cargoes, and is a specialized bulk terminal, apart from fertilizers. He told BNS that it might take some investment to adapt it to other activities.

The association's president admits that it would take time to replace Belarusian fertilizers with other goods, adding that this could increase internal competition within the port.

The terminal handles 10 million to 11 million tons annually. Sileika said it is practically impossible to find such an amount on the market to offset such a loss.

In Lithuania and in neighboring countries, there are no new factories that make products that could be transported through the port. He believes that there may be a redistribution of cargoes, such Lithuanian grains, within the port.

Port CEO: not clear yet if Belaruskali fertilizers will disappear from port.

The decision of the LTG-Belaruskali contract does not mean that Belarusian fertilizers will not be shipped via the port, according to Algis Latakas, CEO of the Klaipeda State Seaport Authority.

In any case, it is extremely difficult to say as there are no sanctions on the cargo or trade in Belaruskali fertilizers, Latakas told BNS. We should not make categorical conclusions yet. He said that LTG has yet to answer the questions, because their infrastructure can be used by other carriers as well.

Latakas stated that a halt to Belarusian fertilizer shipments would be a major loss for the port.

If the cargo stops coming to the port of Klaipeda sooner or later, it will have a significant impact, because it accounts for a large part of the cargo traffic. He said that about 10.5 million to 11 million tons are a significant amount.

According to the CEO, the port's strategic plan foresees a scenario and response to it.

We have mapped out a number of scenarios. This is not just about the cargo, but it is also about the Chinese issue, and the transit of Belarusian oil products that stopped earlier, Latakas said.

He said that we have taken everything into account, and which plan we will use will depend on how events unfold.

With a decline in shipments from the East, the Klaipeda port operators have to look for new opportunities in the West, according to the CEO.

We are by no means turning away from this direction, but we can see that transit cargo through Lithuania is decreasing, so it is necessary to look for other options oriented toward the sea, toward the West, Latakas said.

We are setting ourselves the task of becoming that port of accumulation. He said that some processes are underway and we already see some results in container transportation.

The CEO noted that the Mediterranean Shipping Company MSC has included Klaipeda in its shipping route between West and India and Pakistan.