Panamax of Russian barley runs aground in Bosporus

A panamax vessel carrying a cargo of Russian barley crashed in Turkey, damaging property and potentially resulting in costly delays for the seller, market sources said Monday.

Vitaspirit, a Maltese-flagged vessel, ran aground on Saturday around 1530 local time, causing extensive damage to the shoreline and a waterfront building in the process as well as briefly closing the strait to traffic in both directions.

No injuries were reported by local media outfit Anadolu Agency.

Speculation as to the cause of the crash has been rife, although no official explanation has yet been established by investigators, market sources told Agricensus.

Having been towed away, Vitaspirit has been at anchor in the Marmara Sea since Saturday and the strait has since reopened to traffic.

The Bosporus is one of the world’s busiest shipping lanes with as many as 55,000 vessels a year passing along the route which connects the Mediterranean Sea and the Black Sea.

Cargo

The vessel was transporting approximately 60,000 mt of barley from Russia to Saudi Arabia as part of a SAGO tender which closed February, market sources said. 

Vitaspirit was transporting one of five cargoes which Switzerland-headquartered Glencore sold to Saudi Arabia, sources close to the deal said.

However, the market said the cargo was sold back-to-back and that Glencore has no exposure to the deal.

According to market sources, the terms of contract with SAGO mean delays to delivery would result in a penalty of 1% for each week the cargo was late – equivaltent to just under $2.50/mt based on what was paid in February.

Global barley supply has been tight in the 2017/18 marketing year, with Russian prices spiking to an uncharacteristic $10/mt premium over 12.5% protein milling wheat to be assessed at $217.50/mt FOB Novorossiysk.

Correction: This article previously said feed barley was priced at $239.75/mt FOB Novorossiysk. The correct price is $217.50/mt.