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Sunday, April 2, 2023

Ukraine calls on the UN and Turkey to negotiate the extension of the grain agreement


Ukraine has sent appeals to Turkey and the UN with a call to start negotiations on extending the agreement on grain exports, but the appeal has not yet received a response. This was stated in an interview with Reuters by Deputy Minister of Infrastructure of Ukraine Yuriy Vaskov.

According to Vaskov, the requests were sent last week. Ukraine wants to extend the agreement for at least one year, including the ports of Nikolaev in its scope.

The Black Sea Grains Initiative, brokered by the UN and Turkey, allowed Ukraine to start exporting grain from 3 Ukrainian ports in July 2022. The agreement has already been renewed in November 2022 and expires March 18.

“We sent a letter with a request to start dealing with this issue, because March 18 is very close, but we haven’t heard back yet,” Vaskov said.

Ukraine exports about 3 million tons of agricultural products per month under the Black Sea Grain Initiative.

Yuri Vaskov noted that it is quite possible to export 6 million tons of grain per month from the ports of the Odessa region, and to increase this figure to 8 million tons if the ports of Nikolaev are included in the program.

Reuters sources in the marine insurance industry said Mykolaiv’s joining the program would help expedite the release of some 60 foreign ships stranded in several Ukrainian ports. According to experts in navigation problems, about 26 ships were stranded in Nikolaev alone.

The Black Sea is already listed on the London insurance market as a high-risk area, and additional war risk insurance premiums of tens of thousands of dollars a day are now routine expenses, along with fuel and freight.

The grain corridor operated using foreign-owned ships. Western insurers have played an important role here.

Grain exports from Ukraine, one of the world’s largest grain producers and exporters, fell by almost 27% to 31.8 million tonnes in the 2022/23 season, due to reduced harvest and logistical difficulties caused by the Russian invasion.

At the same time, according to the Ukrainian Ministry of Agriculture, despite the decline in the grain harvest – from a record 86 million in 2021 to 54 million tonnes in 2022, 30 million tonnes of grain are still in the granaries Ukrainians and can be exported.

The Black Sea is listed as a high-risk area in the marine insurance market, and tens of thousands of dollars a day of war risk insurance for grain carriers is now a mandatory expense, with the fuel and freight.

Reuters sources say insurers face a lawsuit worth at least half a billion dollars against commercial ships that are still unable to leave Ukrainian ports a year after the Russian aggression began.

Copyright © 2023 The Eastern Herald.

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