Owners are turning to a variety of costly methods to insure ships heading for Ukraine while a more financially viable package is being finalised by insurance broker Marsh.

Two small bulk carriers successfully completed a grain voyage this week and have been followed by three vessels now heading to Ukraine’s deep-sea grain ports.

Although mainstream war risk insurers have pulled out of the trade, it is understood these ships have either had to go in uninsured or pay around 5% of insured values in premium.

More typical war risk cover is priced at around 0.1%.

Insurance sources said some cover is also available for these ships through a policy now being run by the Ukrainian public road fund.

Marsh is hoping to put together a more commercially credible package, backed by recognised underwriters, that will make the grain trade into Ukraine more cost-effective.

This is also likely to involve Ukrainian state backing.

It is understood the details of the package, which has been more than a month in the making, could be finalised next week, followed by an official launch.

Marsh was the architect of an earlier package of cargo cover, along with underwriter Ascot Insurance, for grain shipments under the now-defunct United Nations’ Black Sea Grain Initiative.

Riskier proposition

However, without the backing of the UN, and in the face of opposition from aggressor Russia, the current attempt to resume regular shipments from Ukraine represents a much riskier proposition for shipowners, crew and underwriters.

The 45,600-dwt Eneida (built 2000), 74,800-dwt Ying Hao 01 (built 2002) and 13,900-dwt Azara (built 1997) are currently heading for the Black Sea ports of Chornomorsk and Pivdennyi to collect grain.

The successful export of grain from Chornomorsk on the 3,300-dwt Resilient Africa (built 2001) and 18,300-dwt Aroyat (built 1997), without incident, have raised hopes that Moscow’s targeting of Ukraine’s grain infrastructure will not include foreign-flag ships.

The Ying Hao 01 is by far the largest and highest-value ship to attempt the voyage. It is worth around $7.9m, according to VesselsValue. At current rates, war risk cover for one week would cost close to $400,000 for the hull alone.