Russia suspends historic deal that allowed Ukraine to export grain during growing famine – Today News
COURTNEY BONNELL (Associated Press)
LONDON (FloridaToday.news) – Russia on Monday suspended a revolutionary wartime deal that allowed Ukraine to ship grain to countries in Africa, the Middle East and Asia, where hunger is a growing threat and high food prices have left more people were below the poverty line.
Kremlin spokesman Dmitry Peskov said the Black Sea Grain Initiative would be put on hold until demands for Russian food and fertilizer supplies to the world are met.
“When the part of the Black Sea deal related to Russia is implemented, Russia will immediately return to implementing the deal,” Peskov said.
While Russia complains that shipping and insurance restrictions are hindering its agricultural exports, it has shipped a record amount of wheat since last year.
The suspension marks the end of an agreement struck between the UN and Turkey last summer to allow food supplies from the Black Sea region after Russia’s invasion of the neighboring country exacerbated the global food crisis. The initiative is believed to have helped bring down skyrocketing prices for wheat, vegetable oil and other food commodities.
Ukraine and Russia are major global suppliers of wheat, barley, sunflower oil and other food products on which developing countries depend.
The suspension of the deal pushed Chicago wheat prices up about 3% to $6.81 a bushel, still about half of last year’s peak. Prices dropped later that day.
Analysts are expecting nothing more than a temporary spike in world food prices as countries such as Russia and Brazil have boosted their exports of wheat and corn. But food insecurity around the world and prices in local stores and markets have risen as developing countries also grapple with climate change, conflict and economic crises. Finding suppliers outside of Ukraine that are further away could also increase costs, analysts said.
The grain deal ensured that ships would not be attacked when entering and leaving Ukrainian ports, while a separate agreement made it easier to move Russian food and fertilizer. Western sanctions do not apply to the supply of agricultural products from Moscow.
President of Ukraine Volodymyr Zelensky said he wants to keep the initiative even without Russian guarantees for the safety of the courts.
“We are not afraid,” he said. “We were approached by companies owning ships. They said they were ready, if Ukraine gives, and Turkey continues to let through, then everyone is ready to continue to supply grain.”
The Russian Foreign Ministry again declared the area “temporarily dangerous.” Sergei Markov, a Moscow-based pro-Kremlin political analyst, has suggested that if Ukraine doesn’t heed the warnings, Russia could strike Ukrainian ports or plant mines along the Black Sea routes.
Turkish President Recep Tayyip Erdogan said officials are in talks with Russia and hope the agreement will be extended.
According to the Joint Focal Point in Istanbul, the Black Sea Grain Initiative has enabled three Ukrainian ports to export 32.9 million metric tons of grain and other food products to the world.
Russia has repeatedly complained that the deal is largely beneficial to richer countries. JCC data shows that 57% of grain from Ukraine was sent to developing countries, with China being the main destination, which received almost a quarter of the food.
UN Secretary-General António Guterres said that the cancellation of the deal will inevitably lead to more human suffering, but the UN will continue to work to secure supplies from Ukraine and Russia.
“We will be focused on finding solutions,” he told reporters. “There is too much at stake in a hungry and suffering world.”
The agreement was extended by 60 days in May, but in recent months the amount of food being shipped and the number of ships leaving Ukraine have fallen sharply, with Russia accused of preventing additional ships from participating.
The war in Ukraine pushed food prices to record highs last year and contributed to a global food crisis that has also been linked to other conflicts, the lingering effects of the COVID-19 pandemic, and climate factors.
High grain prices in countries such as Egypt, Lebanon and Nigeria have exacerbated economic problems and pushed millions of people into poverty or food insecurity.
Rising food prices disproportionately affect people in developing countries because they spend more money on food. Poorer countries that depend on dollar-denominated food imports are also spending more as their currencies weaken and they are forced to import more because of climate change.
Under the agreement, the prices of global food commodities such as wheat and vegetable oil fell, but food was expensive even before the war in Ukraine, and aid did not seep onto kitchen tables.
“Countries like Sudan, Somalia and Ethiopia are dependent on food imports from Ukraine, so this makes food availability and accessibility difficult,” said Shashwat Saraf, regional director of the International Rescue Committee for Eastern Africa.
It’s important now to watch whether Russia is using wheat exports as a weapon, said Simon Evenett, professor of international trade and economic development at the University of St. Gallen in Switzerland.
Currently the world’s largest wheat supplier, Russia could raise its export duties, which would “raise global grain prices and also allow Russia to fund more of its military campaign in Ukraine,” Evenett said. He noted that this month Moscow has already slightly raised them.
The grain deal has faced setbacks as it was brokered by the UN and Turkey. In November, Russia briefly withdrew from the agreement, after which it rejoined and extended it.
In March and May, Russia will only extend by 60 days instead of the usual 120. The volume of grain shipped per month has fallen from a peak of 4.2 million tons in October to more than 2 million tons in June.
Ukraine has accused Russia of preventing the connection of new ships to work since the end of June. Joint checks to make sure ships are only carrying grain and not weapons have slowed down considerably.
Asked on Monday whether the attack on the bridge connecting the Crimean peninsula with Russia was a factor in the decision on the grain deal, a Kremlin spokesman said that was not the case.
Meanwhile, wheat shipments in Russia hit a historic high after a big harvest. It exported 45.5 million metric tons in the 2022-2023 trade year, with another record 47.5 million metric tons expected in 2023-24, according to USDA estimates.
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AP reporters Hanna Arkhirova in Kyiv, Ukraine, Edith M. Lederer at the United Nations, and Andrew Wilkes in Istanbul.
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See AP’s full coverage of the war in Ukraine at https://apnews.com/hub/russia-ukraine and the food crisis at https://apnews.com/hub/food-crisis.
