Expiration of Black Sea Grain Deal Approaches on Monday

A worker handles wheat grain in a storage granary at Aranka Malom kft mill in Bicske, Hungary on Tuesday, May 16, 2023. The Black Sea deal has allowed Ukraine to ship more than 30 million tons of produce from three major ports, helping to bring down global food prices down after they spiked following Russia’s invasion.

Akos Stiller | Bloomberg | Getty Images

WASHINGTON — A groundbreaking agricultural agreement between Ukraine and Russia is about to expire on Monday. This revelation is anticipated to worsen the global repercussions of the ongoing war if Moscow refuses to renew the deal.

Last week, Secretary-General Antonio Guterres sent a letter to Russian President Vladimir Putin outlining proposals to salvage the deal. On Friday, U.N. spokesman Stephane Dujarric informed reporters that discussions with the Kremlin via Signal and WhatsApp would continue over the weekend.

Moscow asserts that the current agreement only supports Ukrainian agricultural products and not Russian fertilizer exports, which are also part of the deal but have not yet been shipped to global destinations.

On Thursday, Putin restated Moscow’s position and, for the fourth time since the agreement’s inception, threatened not to renew it.

A Ukrainian serviceman stands in front of silos of grain from Odesa Black Sea port, before the shipment of grain as the government of Ukraine awaits signal from UN and Turkey to start grain shipments, amid Russia’s invasion of Ukraine, in Odesa, Ukraine July 29, 2022. REUTERS/Nacho Doce

Nacho Doce | Reuters

Prior to the Russian invasion in late February 2022, Kyiv and Moscow accounted for almost a quarter of global grain exports. These agricultural shipments were halted for nearly six months until representatives from Ukraine, Russia, the U.N., and Turkey agreed to establish a humanitarian sea corridor under the Black Sea Grain Initiative.

The deal, brokered last July, relieved Russia’s naval blockade with the reopening of three crucial Ukrainian ports.

As part of the agreement, over 1,000 ships carrying nearly 33 million metric tons of agricultural products have set sail from Ukraine’s war-torn ports of Odesa, Chornomorsk, and Yuzhny-Pivdennyi.

The agreement has also facilitated the transportation of 725,167 tons of wheat on World Food Program vessels to some of the world’s most food-insecure countries, such as Afghanistan, Ethiopia, Somalia, Sudan, and Yemen.

The U.N.-backed organization responsible for monitoring exports under the deal reported on Saturday that no ships have departed from Ukraine’s port of Yuzhny-Pivdennyi for nearly three months. Furthermore, no new vessels have been authorized to depart Ukraine in the past two weeks.

‘Not the deal we agreed to’

Russian President Vladimir Putin and Moscow’s top diplomat Sergei Lavrov both blamed the West for creating global insecurity and instability.

Sean Gallup

In April, Russian Foreign Minister Sergey Lavrov warned that if the Black Sea Grain Initiative did not include fertilizer products soon, Moscow would not renew the agreement.

“It was not called the grain deal; it was called the Black Sea Initiative, and in the text itself, the agreement stated that this applies to the expansion of opportunities to export grain and fertilizer,” Lavrov told reporters during an April 26 press conference at the U.N.

“That’s not the deal we agreed to on July 22,” he said, adding that dozens of Russian ships loaded with approximately 200,000 tons of fertilizer are waiting for export. In addition to the inclusion of fertilizer exports, the Kremlin has also requested the resumption of a pipeline that passes through Russia and ends at a Ukrainian port.

One of Moscow’s key demands is for the Russian Agricultural Bank, or Rosselkhozbank, to be reinstated in the SWIFT banking system.

Moscow’s exclusion from SWIFT, which stands for the Society for Worldwide Interbank Financial Telecommunication, severed the country from much of the world’s financial networks in the days following Russia’s full-scale invasion.

Expect wheat prices to 'spike again' if Black Sea grain deal is not renewed in July: Strategist

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