All Set for Yuzhny Grain Terminal Construction

Ukrainian Sea Ports Authority (USPA) and MV Cargo LLC, a specially formed company for the Yuzhnyi port project, have signed an agreement on the implementation of two partnership projects for the construction of a terminal in the port Yuzhny, situated on the country’s Black Sea coast.

Under the terms of the agreement MV Cargo will undertake the construction of a specialized grain terminal as well as a berth № 25 in the sea port of Yuzhny. In the first phase of the project the capacity of the terminal will amount up to 5 million tons and the second phase provides for the increase by another 2–4 million tons.

In turn, USPA is to ensure navigable operational water area at the berth № 25 as well as the approaching channel to the future grain terminal, which will see depths of the waters and the approaching channel be dredged down to 16 meters.

The estimated investment in the construction of the grain terminal will amount to USD 104 million with USPA investing USD 50 million for dredging works. A feasibility study of the project for advanced depths in the port of Yuzhny has already been submitted for endorsement in core ministries, USPA said.

The terminal will be majority-owned by US agriculture giant Cargill Inc. through a joint venture company.

The signing comes on the back of an agreement signed on 24 February 2016, when Cargill and MV Cargo penned the construction deal for the new grain terminal in Yuzhny sea port.

“A key component of the agreement for us is the term under which the Cargill ensure the loading of the terminal with necessary volumes of grain cargo. This is a vivid example of an idea to assign the cargo owner with certain berth, which creates a comfortable and clear conditions for public-private partnership”, said CEO of USPA Andrey Amelin.

“We expect the project to generate over UAH 300 million in tax payments annually and to create employment for around 350 people,” said Director of MV Cargo LLC Alexander Primak.

MV Cargo LLC grain terminal completion is scheduled for 1 September 2018. In turn, USPA agreed to finish dredging at the latest 1 February 2018.

In August 2015, the Ministry of Infrastructure of Ukraine signed a trilateral memorandum formalizing the intention to implement the investment project in the sea port of Yuzhny, which certified Cargill’s intention to purchase 51% of shares of cargo terminal.



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