GENEVA (AP) — The United Nations was working urgently to expand a deal that has allowed the continued export of Ukrainian grain across the Black Sea to famine-threatened parts of the world and helped alleviate a global food crisis exacerbated by the war. over a year ago by Russia.
The landmark deal the UN and Turkey brokered with the two sides last summer was accompanied by a separate agreement to facilitate the export of fertilizer and food from Russia, which Moscow insists has not been implemented.
Russia set a deadline of Thursday for its concerns to be resolved, or else it would drop out of the program. This aggressive strategy is not new: last March, when a similar extension was at stake, Russia unilaterally decided to renew it for only 60 days instead of the 120 indicated in the agreement.
United Nations officials and analysts warn that failure to expand the Black Sea Grain Initiative could harm countries in Africa, the Middle East and parts of Asia that rely on Ukrainian wheat, barley, sunflower oil and other affordable foods, especially in light of the effect of drought in some places. The deal has helped lower the price of staple foods like wheat over the past year, but that relief hasn’t reached households.
“If the grain deal is canceled again, when we’re already in a tough enough situation, it’s going to be one more thing that the world doesn’t need, so prices could start to go higher,” said William Osnato, an analyst at research at farm data and analytics firm Gro Intelligence. “There is no relief on the horizon.”
United Nations humanitarian chief Martin Griffiths told the Security Council on Monday that the deal is “crucial” and that negotiations were still ongoing.
Negotiators meeting last week in Istanbul did not appear to make much progress. Ukrainian Deputy Prime Minister Oleksandr Kubrakov said the agreement “should be extended and extended for a longer period” to “give predictability and confidence” to the markets.
Moscow said it was opposed to expanding or renewing the mechanism indefinitely. Kremlin spokesman Dmitry Peskov said Tuesday there was an “intensive meeting of contacts” but “no decision has been made yet.”
Russia, for its part, is making rapid deliveries of its large wheat crop to other ports. Critics say that suggests Moscow is positioning itself or seeking concessions in other areas, such as Western sanctions, and say it has slowed down joint inspections of Ukrainian ships by Russian, Ukrainian, Turkish and UN observers.
Average daily inspections, which aim to ensure ships are only carrying food and not weapons, have steadily dropped from a peak of 10.6 in October to 3.2 last month.
Russia denies slowing down work and Ukrainian grain shipments have also fallen in recent weeks.
“We cannot accept that the role of the Russian (inspector) should be reduced to an automatic approval or stamp of the applications submitted by Kiev,” Russian Ambassador to Geneva Gennady Gatilov told reporters last month.
Asked if an abandonment of the agreement could be followed by a blockade on the Ukrainian coast or more attacks on its ports, Gatilov said that the Russian authorities “study any possible situation if the agreement is not extended.”
Russia has five main demands, Gatilov noted. First of all, the restoration of the foreign supply of agricultural machinery and spare parts, as well as the lifting of restrictions on insurance and access to foreign ports for Russian ships and goods. They are also calling for a pipeline that sends Russian ammonia, a key fertilizer ingredient, to a Ukrainian Black Sea port to be resumed, and for restrictions on financial activities associated with Russian fertilizer companies to be lifted. Finally, he calls for the Russian Agricultural Bank’s access to the SWIFT international banking system to be restored.
The United Nations says it is doing what it can, but that those solutions depend mainly on the private sector, where it has little influence.
The agreement has made it possible to send 30 million tons of Ukrainian grain, of which more than half went to developing countries. China, Spain and Turkey were the main recipients, and Russia says that shows that food is not reaching the poorest countries.
UN Secretary General António Guterres says Ukrainian corn for animal feed has found its way to developed countries, while “most” grain for human consumption has gone to emerging economies.
Even if a “significant part” of the shipments reaches developed nations, that “has a positive impact for all countries because it lowers prices,” Guterres told reporters in Nairobi, Kenya this month. “And when prices are lowered, everyone benefits.”
Osnato, the analyst, noted that markets have not reacted to Russian threats to pull out of the deal and wheat recently hit its lowest price in two years. If the deal is not renewed or negotiations drag on, he noted, the “loss of Ukrainian grain would not be a disaster” for a month or two.
Russia is using “bragging rights” to demand that some sanctions be relaxed while exporting a record amount of wheat for this time of year and its fertilizers are also selling well, he said.
“It’s more a matter of getting some edge, and they do what they can to put themselves in a better bargaining position,” Osnato said.
Trade data tracked by financial data provider Refinitiv showed that Russia exported just over 4 million tonnes of wheat in April, the highest volume for that month in five years, after record or near-record highs in several previous months.
Exports since last July reached 32.2 million tons, 34% above the same period last season, according to Refinitiv. The firm estimates that Russia will export 44 million tons of wheat in the 2022-2023 season.
The issue becomes more urgent as the Ukrainian wheat harvest in June approaches and the need to sell that crop in July. If the Black Sea corridor is unavailable by then, that “will start to take another large amount of wheat and other grains off the market,” Osnato said.
Ukraine can ship its food overland through Europe so it wouldn’t be totally cut off from international markets, but those routes have less capacity than shipping and have fueled divisions in the European Union.
Uncertainties such as drought in places like Morocco, Tunisia, Algeria, Syria and East Africa, big food importers, are likely to keep prices high, and an end to the United Nations program in the Black Sea would not help.
“Any shock to markets can cause enormous damage with catastrophic side effects in countries on the brink of famine,” said Shashwat Saraf, East Africa emergencies director at the International Rescue Committee.
“The expiration of the Black Sea Initiative is likely to lead to higher levels of hunger and malnutrition, exacerbating the disaster in East Africa,” Saraf said.
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Bonnell reported from London. AP journalists Evelyne Musambi in Nairobi, Kenya; Edith M. Lederer at the United Nations and Dasha Litvinova in Tallinn, Estonia, contributed to this dispatch.