Kremlin prospects on Black Sea grain deal ‘not great’ Ship’s crew

Reuters

By Guy Faulconbridge

MOSCOW, April 12 (Reuters) – The Kremlin said on Wednesday the prospects for the landmark UN-brokered Black Sea grain deal were not good as promises to remove barriers to Russian agricultural and fertilizer exports had not been fulfilled.

The grain deal is an attempt to alleviate a food crisis that existed before the Russian invasion of Ukraine but was made worse by Europe’s deadliest war since World War II.

The agreement was first signed by Russia, Ukraine, Turkey and the United Nations in July last year and has been extended twice.

On paper, it allows the export of food and fertilizers, including ammonia, from three Ukrainian Black Sea ports. But Moscow says deliveries are being hampered by obstacles – like insurance and payment hurdles – which it says must be removed.

Kremlin spokesman Dmitry Peskov said the current deal is not working for Russia, despite some efforts by the United Nations to implement the parts of the deal that affect Moscow’s interests.

“No deal can stand on one leg, it has to stand on two legs,” Peskow told reporters. “In this respect, the prospects (for their extension) are of course not so good judging from today.”

Russia and Ukraine are two of the world’s top producers of agricultural commodities and major players in the wheat, barley, corn, rapeseed, rapeseed oil, sunflower seed and sunflower oil markets. Russia also dominates the fertilizer market.

The corridor has enabled more than 27 million tons of grain and oilseeds to be exported from Ukraine, and its closure would likely result in a significant jump in prices at a critical time.

The United Nations World Food Program warned earlier this month that food insecurity will remain at unprecedented levels in 2023 as conflict, economic shocks, climate extremes and rising fertilizer prices continue to disrupt food production around the world.

Last month, Russia said it would extend the deal by another 60 days, despite pushing for another 120-day extension from the United Nations, Ukraine and Turkey. Moscow says it is due to expire on May 18.

“Exactly half of this deal hasn’t worked and isn’t working,” Peskov said.

Ukrainian officials have repeatedly said they are fulfilling their side of the deal and cannot comment on the implementation of the Russia-UN accords

However, Kiev has previously urged all parties to the deal to prevent Russia from artificially blocking food supplies on world markets and using food as a weapon.

There have recently been some disruptions to the flow of grain through the corridor, according to the United Nations, as no ships were inspected on Tuesday to allow the parties to agree on operational priorities.

Checks resumed on Wednesday.

Russia has repeatedly said that any further extension of the deal will require the West to meet a variety of its demands, including reconnecting the Russian Agricultural Bank (Rosselkhozbank) to the SWIFT payment system.

Other demands include a resumption of deliveries of farm machinery and parts, the lifting of insurance and reinsurance restrictions, access to ports, the resumption of the Togliatti-Odessa ammonia pipeline and the release of assets and accounts of Russian companies involved in food and foodstuffs are involved export of fertilizers.

(Additional reporting by Nigel Hunt and Pavel Polityuk; Editing by Andrew Osborn and Tomasz Janowski)

(c) Copyright Thomson Reuters 2023.

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