Efforts to save the Black Sea Grains Initiative

SGGP 07/18/2023 09:21

The last ship carrying Ukrainian grain under the Black Sea Grain Initiative has left the port of Odessa before the deal expires on July 17. The International Rescue Committee (IRC) has warned of catastrophic impacts on global food insecurity if the deal is not extended.

Ship carrying grain under the Black Sea Grain Initiative agreement anchors in Türkiye

Major damage

Despite the efforts of all parties, there is no sign that Russia has agreed to extend the Black Sea Grain Initiative. Russian President Vladimir Putin has stated that the obligations to remove obstacles to Russian food and fertilizer exports under the initiative have not been fulfilled, and the main goal of the agreement, to supply grain to countries in need, has not been fulfilled. Mr. Putin left open the possibility of re-participation if commitments to Russia are fulfilled.

Meanwhile, in an effort to salvage the Black Sea Grains Initiative, the European Union (EU) and the United Nations have made a concession to address Russia’s complaints about Western sanctions that are hampering its food and fertilizer exports. The UN Security Council is scheduled to hold a meeting on the situation in Ukraine on July 17, with the participation of top diplomats from several countries.

According to the latest data from the Joint Coordination Center in Istanbul, some 33 million tons of agricultural products have been exported under the grain deal. Low- and lower-middle-income countries received only 10% of the corn and 40% of the wheat shipped under the grain deal. Ukraine’s Ministry of Agriculture and Customs estimates that if the deal collapses, Kiev will lose up to $500 million a month.

Plan B

The United Nations and Türkiye have been mediating the Black Sea Grains Initiative agreement since July 2022 to help address the global food crisis. The agreement has been extended three times, with the most recent extension taking effect on May 18 and lasting for two months.

Talks between Turkish President Recep Tayyip Erdoğan and his Ukrainian counterpart Volodymyr Zelenskyy in Istanbul in early July sparked speculation that the Turkish navy might escort the grain ships if Russia refused to allow safe passage through the Black Sea. However, in a statement to Politico, Ukrainian Ambassador to Turkey Vasyl Bondar dismissed this.

Observers say Ukraine has other plans to protect ships moving through the Black Sea. It is setting up a $500 million guarantee fund to cover any damage or costs. The Ukrainian Grain Association said the fund would function like a state insurance. Ukraine has asked the European Commission to pay the fund, and Ukraine would reimburse the costs. Ukraine is also looking for alternative routes to the Black Sea. The nearest port to Ukraine, Constanta in neighboring Romania, is a potential alternative.

According to Reuters, the Russian Foreign Ministry accused the UK and US of involvement in the Ukrainian attack on the Crimean bridge on the evening of July 16, which killed two people. The Russian National Anti-Terrorism Committee (NAK) said that Ukraine carried out the terrorist attack using unmanned vehicles. Russia has opened a criminal investigation into the incident.

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