Ukrainian maritime grain exports are expected to fall by around 20% in January from the previous month due to the crisis in the Red Sea and the New Year holidays, a senior Ukrainian government official said on Thursday.

“Looks like it could be around minus 20%. But in any case it would be a very substantial volume,” the source told Reuters, declining to be named because of the sensitivity of the matter.

Such a decrease would be a setback for wartime Ukraine which exported a record high amount of food via its Black Sea corridor in December, surpassing the maximum volume exported under a previous U.N.-brokered grain deal in a single month.

Agriculture Minister Mykola Solsky said earlier on Thursday that key Ukrainian food exports might decrease this month because of the situation in the Red Sea.

Attacks by Iran-allied Houthi militia in Yemen on vessels in the region since November have slowed trade between Asia and Europe and alarmed major powers.

The U.S. has begun strikes on Houthi sites aiming to degrade their ability to attack shipping in the Red Sea.

Passage through the Red Sea is very important for Ukraine, as almost a third of its exports via the alternative Black Sea corridor are sent to China.

Ukraine, one of the major global producers and exporters of food products, harvested about 80 million metric tons of grains and oilseeds in 2023 and its combined grain and oilseed exportable surplus is about 50 million tons in the 2023/24 July-June season, the government said.

The farm ministry data showed grain exports had reached 20.9 million tons as of January 17, 2024 versus 25.1 million as of January 20, 2023.

The volume included 11.2 million tons of corn and 8.3 million tons of wheat.

Food and metal products traditionally dominated Ukrainian exports before the Russian invasion in February 2022, but the share of metals has now fallen significantly due to Russia’s destruction of large factories in southern Ukraine.

Source: Reuters reported by Pavel Polityuk and edited by Tom Balmforth and Sharon Singleton