UkrFerry’s Wartime Survival: “Whatever the Wind, You Need to Keep Your Sails Up”

The war that resulted from Russia’s full-scale invasion severely affected international trade with Ukraine, with no region being as much affected as Ukrainian Black Sea ports and shipping companies - among them UkrFerry, its main Ukrainian ferry operator.

For six months after the start of the war, shipping to and from Ukraine was completely halted. Then, gradually, because of the persistent efforts of the Ukrainian government, some intermediary countries and the UN the work of Ukrainian ports was able to partly restart - for the export of bulk cargo, primarily grain, and the import of steel, fertilizers and coal.

With the establishment of the Ukrainian “grain corridor,” more than 100 million tons of cargo, mainly grain, have been transported through its ports. This allowed ports, terminals and stevedoring companies handling these types of cargo to be able to save the jobs of their employees and resume their economic activities.

Ferry services have not yet been able to resume. Prior to the war, the Odesa based company UkrFerry, the Black Sea’s biggest ferry operator, served routes between several Ukrainian ports to Turkey, Georgia, and during certain periods during the year to Bulgaria and Romania.

Roman Morgenstern UkrFerry’s Marketing & Project Director, and a company shareholder spoke about how the company has survived.

What happened to UkrFerry in these three challenging years?

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The beginning was a real disaster. The well-established business and normal life were gone with the storm the wind of war brought on day one. Two of the company’s ferries were immediately blocked in the port of Chernomorsk on Feb. 24, the day the war began, without any hope of resuming work.

The third ferry was at sea at that moment, returning from Georgia, was forced to turn around, return to Georgia, unloading all the cargo and passengers. Ferry lines to Turkey and Georgia stopped operating without any hope of resumption in the foreseeable future; everything that the company had built up over almost 30 years was blown away. The situation was aggravated by our development plan.

Which plan of development?

The year before the war was a successful year for UkrFerry. All of the company’s lines have seen steady growth and the company’s board of directors decided in December 2021 to take on the management of an additional ferry.

UkrFerry has long-standing cooperation with many leading ferry companies in Europe. In December 2021, a contract with the big Italian company Grimaldi was signed with delivery of a new vessel scheduled for March 2022.

Were none of your contacts in the sector aware of the upcoming war?

Despite the fact that the clouds were already gathering around Ukraine, the management of UkrFerry, like many other Ukrainian businessmen, did not really believe in the possibility of a full-scale war. Unfortunately, the worst-case scenario came true and then, in March 2022, our company no longer needed the new vessel at all, since there could no longer be any work for it in the Black Sea, along with the vessels that the company was already operating.

What about the relationships with your sector colleagues and partners in other countries?

I think that our colleagues from European countries could not have dreamed of this even in their worst nightmare: No more business, ferries blocked and left without deployment, no income and huge losses incurred owing to war.

You need to pay a considerable money for a new unusable ferry, you need to keep the entire fleet in working order, pay wages to office workers and ship crews and you do not know how long this situation will last. On the top to these work problems also the dramatical changes among our families, with so many leaving Ukraine for safety reasons.

What was Ukrferry’s management’s reaction in the middle of this nightmare?

It was a time when I realized the genius of the Beatle’s famous song “Yesterday” thoroughly. “You never might be secured in this world and even things which You think impossible may happen…”

Nevertheless, the company managed to overcome this situation, which seemed to be a dead end.

What were the steps towards your company’s recovery?

First, our company managed in April 2022 to conclude a contract for the charter of the remaining unblocked ferry with the UN World Food Program, thanks to the help of our long-term partners and friends - chartering brokers from UK, Germany and Italy. This was a very important deal, which UkrFerry successfully completed.

The company’s next success was a charter contract with “Africa Morocco Links” to operate a ferry to cross the Strait of Gibraltar between the ports of Spain and Morocco. This contract is ongoing and over the intervening two and a half years UkrFerry has become well known to road transport companies operating between the EU and North Africa using the Gibraltar straight’s route.

Despite the difficult and uncertain situation, UkrFerry’s management decided to take delivery of the additional ferry from Grimaldi in May 2022. Taking delivery of a new ferry seemed an unnecessarily risky decision but soon proved to be a correct move.

The new ferry was immediately chartered by the leading Spanish ferry companies Balearia and Suardiaz. These charter contracts continue to this day, the ferry has proven to be highly effective for transporting new cars from European manufacturers to Mediterranean ports.

In the fall of 2022, UkrFerry managed to release its two blockaded ferries from the port of Chornomorsk. They were brought to work on Mediterranean Sea ports. In the summer of 2024, UkrFerry took yet another ferry under management from the Swedish STENA line

We are now working in a new promising market: transport of cars, trucks, and construction equipment from EU countries to Libya. Other company vessels are navigating from EU ports to Israel, Egypt, Cyprus, Greece and other destinations. Our affiliated grain trading company TransFerry has also continued to work.

So, your crisis management team found a solution through international partnerships.

New markets and diversification were the key to success for us. The war forced UkrFerry, as well as many other Ukrainian companies, to significantly change their trading area and become much more international in terms of markets, customers and partners. Reorientation to new markets of the EU and the Mediterranean Sea, however, did not change the company’s plan to continue operating its historical lines Ukraine-Georgia and Ukraine-Turkey at the first opportunity.

What are your plans to re-establish ferry services from Ukraine?

UkrFerry’s management is actively preparing for this together with the company’s partners in Turkey and Georgia as well as with Ukrainian forwarders. We are passing these difficult times and keeping our experienced staff and crews.  None of the company’s employees were laid off. Everyone gets paid.

I believe this is one of UkrFerry’s biggest achievements despite the war we have created a strong basis for future post-war development.

What about the economy of Black Sea region? Do you expect a recovery after the war?

We are confident in a successful future for Black Sea ferry shipping after the war and UkrFerry will be here to start new projects with our European partners. The Russian attacks of course did damage to some port infrastructure such as the Odesa Cruise Terminal, which has to be restored. It was used also by UkrFerry for regular service to Istanbul and cruises around Black Sea.

You are also a researcher of maritime history and the contribution ferry services made to the development of Odesa.

I remember a lot of pre-war times interesting events onboard, meetings, concerts, which showed how ferry business always contributed to the wonderful cultural life of Odesa. Hope such happy and peaceful days come again soon.

Roman Morgenstern, UkrFerry’s Marketing & Project Director, graduated from the Odesa Maritime University. He is also a company’s shareholder. He has also dedicated much effort to the preservation of Odesa’s maritime heritage, one of his achievements is the book “Odessa Maritime Encyclopedia.”