The last ship carrying grain from Ukraine left the port of Odesa on Sunday under a UN-brokered agreement guaranteeing safe passage. The deal expires on July 17, and Russia has yet to agree to an extension.
What is the Black Sea Grain Agreement, why is it important, and why is Russia threatening to withdraw from it? We explain.
What is the Black Sea Grain Deal?
Ukraine It is one of the world’s largest exporters of food grains such as wheat and maize and is a major contributor to the UN’s food aid programs. When Russia invaded the country and blockaded its ports, it sent food prices soaring and raised fears about food security in the world’s poorest countries. For example, wheat prices in Pakistan have skyrocketed to crisis levels.
On July 22, 2022, the UN and Turkey agreed to Russia’s Black Sea Grain Initiative, under which cargo ships would be allowed to sail from the three Ukrainian ports of Odesa, Chornomorsk, and Pivdenny (Yushny). No weapons were carried. The safe passage in the Black Sea was 310 nautical miles long and three nautical miles wide.
The contract has been extended twice and will expire on Monday.
According to a Reuters report in June, Ukraine exported about 32 million tons of corn and wheat under the deal.
Why didn’t Russia agree to renew it?
Russia claims that promises made to it under the agreement have not been met and that it still faces problems exporting its own agricultural products and fertilizers due to several sanctions imposed by the West.
Although it has no direct control over Russia’s agricultural products, the country says bottlenecks in payment platforms, insurance, shipping and other logistics hamper its exports.
“We have repeatedly shown our goodwill to extend this agreement,” Putin told reporters on July 13, as quoted by the AP. “Enough is enough.”
Russia also said it agreed to the grain deal to help ensure global food security, but then Ukraine exports mainly to high- and middle-income countries. Although this is true, the UN says that falling food prices have helped poor countries.
According to Reuters, the European Union (EU) is now considering linking a subsidiary of Russian Agricultural Bank (Rosalkhozbank) to the Society for Worldwide Interbank Financial Telecommunication (SWIFT), from which it was cut off because of the war. and fertilizer transactions.
How did Russia and Ukraine export grain during the war?
Indian Express Earlier it was reported that Russia is consolidating With its position as the world’s top wheat exporter, Ukraine’s exports have more than halved from their peak and production has plunged to an 11-year low.
The primary destinations for Russian wheat are the Middle East, North Africa and Central Asia, led by Egypt, Iran and Algeria. While the Black Sea Grain Initiative helped Ukraine to export 16.8 million tonnes in 2022-23, 39% of its wheat actually moved by land to Eastern Europe. Ukraine’s markets had shifted dramatically from pre-war Asia and North Africa to mainly Europe, mostly due to ease of shipping. In fact, the glut of Ukrainian grain has sparked protests from farmers in some Eastern European countries, who say prices for their products have collapsed.