Brussels, Belgium (TEH) – In a move that could disrupt the global grain trade, Ukrainian diplomatic sources in Brussels have warned that halting the grain deal with Russia would render sea shipping impossible, reports Politico, necessitating a doubling of grain exports by land. The implications of such a decision would not only strain land transportation resources but also lead to an oversupply of grain in the market, resulting in reduced purchasing prices. This dire forecast has ignited concerns across the international community.
European Commission President, Ursula von der Leyen, has strongly condemned the Russian Federation’s “cynical stance” on terminating the security of sea grain supplies. She underscored that the European Union remains committed to facilitating the transport of grain from Ukraine to global markets. The decision by the Russian side has left the European Union grappling with the challenge of ensuring the smooth flow of grain and averting potential economic consequences.
Adding to the complexity of the situation, Russia and the United Nations have recently signed a memorandum to simplify the export of agricultural products from Ukrainian territory. Alexander Grushko, the Deputy Head of the Russian Ministry of Foreign Affairs, highlighted that this memorandum will come into effect after the grain agreement expires. Notably, Grushko emphasized that the implementation of the Black Sea agreement resulted in a mere 3 percent of the grain reaching the most impoverished nations, while the remaining 97 percent was directed to European Union countries.
Unfazed by these developments, Ukrainian President Volodymyr Zelenskyy has reiterated his determination to continue exporting grain from Black Sea ports. Zelenskyy emphasized that Ukraine has already secured agreements with Turkey and the United Nations, stressing that Russia holds no sway over the safe transportation of grain across the Black Sea.
The implications of this brewing dispute are vast, extending beyond the immediate concerns of grain shipping and market stability. The reliance on land transportation would strain existing infrastructure, potentially leading to logistical challenges and increased costs for exporters. Furthermore, the oversupply of grain in the market could have long-term ramifications, with decreased purchasing prices impacting farmers and the agricultural sector at large.
Russia said on Monday it was withdrawing from a wartime agreement to allow grain exports from Ukraine through the Black Sea ports until its demands were met, upending a deal that had helped alleviate global food prices and shortages https://t.co/O4u8XSQOfx
— New York Times World (@nytimesworld) July 17, 2023
As the European Union intensifies efforts to secure alternative means of transporting grain from Ukraine, the global grain trade watches with apprehension. The Ukrainian government’s determination to safeguard its grain exports signals a resolve to overcome potential obstacles and ensure continued participation in the international market. The coming weeks will prove crucial in determining the future trajectory of the grain trade, as stakeholders anxiously await diplomatic resolutions and measures to mitigate disruptions.