Ukraine has called for the agreement lifting Russia’s blockade on its grain exports from the Black Sea to be extended to other products, such as metals, after the route’s first successful use.
Taras Kachka, Ukraine’s trade negotiator and deputy minister of economy, said he was hopeful that the Ukraine-Russia deal allowing the resumption of grain trade would stand and suggested it could serve as a template for other commodities because traders and exporters “always test the limits”.
“This agreement is about logistics, about the movement of ships through the Black Sea,” he said. “What is the difference between grain and iron ore?”
Kachka spoke after Lebanon-bound Razoni, who had been detained in Odessa since Russia began its full-scale invasion of Ukraine, forced his way through Russian and Ukrainian mines laid at sea and cleared inspections in Turkey.
More than a dozen ships carrying grain are waiting to depart from Ukrainian ports, while another ship is en route to the Ukrainian port of Chornomorsk.
Under the UN-Turkey agreement, Russia agreed not to attack ships carrying food and fertilizers as long as it could — along with officials from Ukraine, Russia, Turkey and the UN — to inspect the ships at a location in the United Nations. bosphorus.
Ukraine is the world’s fifth largest wheat exporter and some vulnerable countries such as Lebanon, Syria and Somalia rely on it for most of their wheat imports.
The tentative resumption of the Black Sea trade route has raised hopes that some 20 million tons of wheat, maize and other grains stuck in Ukraine could find their way to global markets and provide income for Ukrainian farmers before the winter planting season.
Mykhailo Podolyak, a senior adviser to Ukrainian President Volodymyr Zelenskyy, said the deal would likely last “for some time” as long as it also served Russia’s economic interests.
“It seems to me that this [sea] caravans will go back and forth for some time, in parallel with Russian caravans, who are also eager to ship their grain,” he said. But he warned: “Russia will find a way to block all this again. This is my pessimistic and optimistic scenario cobbled together.”
Podolyak and others in the Ukrainian government believe Russia agreed to this plan because the invasion of Ukraine had not gone according to Moscow’s schedule. Russia planned to seize the ports of Odessa and Mykolayiv to take control of the export routes in the Black Sea region, Podolyak said.
Russia welcomes the deal. “This is not a one-time mechanism, but one designed to ensure the export of the grain that has accumulated in these ports,” Kremlin spokesman Dmitry Peskov said on Thursday. “Therefore, we hope that this mechanism continues to work just as effectively.”
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Oleg Ustenko, Zelenskyy’s economic adviser, said lifting the blockade could help prevent economic disasters. Before the war, most of Ukraine’s exports went through the Black Sea, he estimates.
However, the post-war rise in logistics costs due to attempts to divert exports by rail or road has not made Ukrainian products competitive in the global market, he added.
“This was part of the plan[by Russia]. . . to weaken the Ukrainian economy,” he said.
The only sunflower seed product Kiev has been able to consistently export since the outbreak of the war is non-edible grade sunflower oil, about 300,000 tons of which is transported by truck to be blended into fuels in Europe.
The country managed to export about 3 million tons of grain by road, rail and the Danube River last month, Kachka said, or less than half the volumes exported mainly through the Black Sea before the war. Ukraine estimates it will harvest 67 million tons of grain this year, up from a record 86 million tons in 2021.
Even with a relaxed Black Sea blockade, Ukrainian farmers will plant cautiously this winter, Kachka said.