Ukraine's grain agreement with Russia extended 4 months

Source: Politico

A diplomatic agreement that restarted Ukraine's maritime food exports will continue for at least another four months, keeping the economic lifeline open as the major food producer faces its first full winter at war with Russia.

Ukraine, the United Nations and Turkey on Thursday announced the extension to the deal to unlock three Ukrainian Black Sea ports that was brokered with Russia over the summer.

The initiative — technically formed of two agreements, each bolstering Ukraine and Russia's food exports — only lasts until Saturday, and Russia has made repeated threats to abandon it, even suspending participation for a few days earlier this month.

"Black Sea Grain Initiative will be prolonged for 120 days," Ukraine's Minister of Infrastructure Oleksandr Kubrakov said in a tweet.

Ukrainian President Volodymyr Zelenskyy also tweeted about the extension, and Turkey's President Recep Tayyip Erdoğan later confirmed the extension in his own set of tweets.

“The significance and benefits of this agreement for the food supply and security of the world have become evident,” wrote Erdoğan, who has emerged as a major geopolitical player when it comes to world hunger due to his brokering of the grain agreement.

In a statement, U.N. chief António Guterres welcomed the agreement "by all the parties" to renew the deal.

Russia, however, is yet to publicly acknowledge the extension of the agreement.

The agreement has brought down global food prices which soared following Russia’s invasion in February and its total blockade of Ukraine’s Black Sea ports, which lasted until July.

According to the latest U.N. data over 11 million metric tons of foodstuffs have since left Odesa and two other ports under the initiative, on 462 ships. That includes several cargoes of grain chartered by the World Food Programme, taking humanitarian food aid to places like Yemen, Somalia and Afghanistan.

A WFP ship called Nord Vind is currently en route to Ethiopia, carrying 25,000 metric tons of Ukrainian wheat.

A person close to the negotiations said the agreement will roll over under exactly the same conditions that were agreed upon back in July.

New deadline

The four-month rollover of the deal is good news for the world's poorest countries, many of which rely on unimpeded grain flows from Ukraine. But it creates a new deadline next March for extending the deal again, giving Moscow further leverage to threaten to quit the agreement and demand concessions on Western sanctions.

Amid weeks of negotiations on the future of the deal, Ukraine had been pushing to expand the scope of the agreement to give two more of its seaports access to the protected corridor and, along with Turkey, extend it for a one-year period.

However, it appears that those demands have come to nothing, perhaps because Russia failed to make headway on its own demands in the negotiations, namely getting relief from Western financial sanctions on the state-owned Russian Agricultural Bank and the reopening of a key ammonia export pipeline.

Russia has claimed that it is not seeing the benefit of its side of the bargain because of the indirect chilling effect of Western sanctions on its food and fertilizer exports. The EU maintains that its sanctions do not impact trade in food or fertilizers.

In an apparent concession to Moscow, France recently announced that it would spend €7.5 million to ship Russian-donated fertilizer to Africa, under the World Food Programme. However, French President Emmanuel Macron has pointed out that it was "irresponsible" of Russia to impose export restrictions on its own fertilizers.

In his statement, Guterres said: "The United Nations is also fully committed to removing the remaining obstacles to exporting food and fertilizers from the Russian Federation."

European Commission President Ursula von der Leyen congratulated Guterres and Erdoğan for negotiating the deal's extension. The EU’s project to boost Ukraine’s land-based exports has shifted more tons of food than have since been exported by sea, although those efforts began long before the Black Sea grain deal was implemented.