Ukraine-Russia Pact

Ukraine and Russia reached a landmark agreement to allow grain shipments to restart through blockaded ports in the Black Sea. But a Russian missile strike on Odessa seemingly threatened the deal, but there were signs that they were moving forward despite the Odessa fiasco.

Some 20 million tons of grain—from last year’s harvest—has been stuck in Ukraine since the beginning of the war in February. The reason: Russia has been blocking shipments out of the Black Sea, a key freight route, and Ukraine has been mining sea lanes as a defensive measure. As a result, the world has lost a key source of supply for essential staples such as wheat, barley and sunflower oil. Sudden surge in edible oil prices in India is due to stoppage of imports from Ukraine. It’s fanned what was already a major global food crisis. Now, a deal has been struck to allow these shipments to leave the country—and Ukraine said it had begun work to set up sea corridors to resume grain exports.

The deal, which was announced in Turkey, is aimed at restarting Ukrainian grain exports by ensuring safe passage out of the Black Sea for ships carrying wheat, barley and other staples. Turkey and the UN will help with inspecting ships to make sure that they aren’t being used to transport anything else, like military equipment.

The mechanics are, on the face of it, fairly straightforward. Turkey and the UN will help with inspecting ships to make sure that they aren’t being used to transport military hardware. The ships will be steered out by Ukrainian captains, head to Turkey, where a joint command centre will be set up to inspect the vessels; there, in addition to Turkish and UN officials, Ukrainian and Russian representatives will be present to safeguard the interests of both sides.

Now, Russia also gets something out of the pact, of course. As a result of the negotiations that led to this deal, steps will be taken to facilitate exports from Russia of grain and, perhaps most critically, fertiliser. Moscow is the world’s largest fertiliser exporter, and a drop-off in supplies since the outbreak of the war has hit farmers worldwide, in places as far off as Peru.

The biggest impact will be on the countries that were most dependent on Ukrainian imports, and most of those are located in the surrounding Middle East and Africa region—places such as Egypt, which has been waiting on deliveries of hundreds of thousands of tons of grain since February, and Somalia, which relied on Ukraine for the majority of its wheat imports.

Ukraine is a major part of the global food supply chain. Getting the 20 million tons of grain from last year’s harvest out of the country is important, but experts are already looking to the next harvest. It’s not clear right now exactly how successful it will be—and the reason for that is the war. In parts of the country, particularly around the eastern provinces, it’s not clear how much land Ukrainian farmers will be able to access safely. Certainly, as the war continues, it will be reduced—and so the harvest will be smaller. And that means the world will continue to suffer, as a major source of food is squeezed, creating shortfalls and driving up food prices internationally.

The key thing to watch in the days and weeks ahead will be how much grain is eventually shipped out of Ukraine and whether Russia and Ukraine will honour the agreement. There were questions about Moscow’s commitment just a day after the deal was announced, when Russia bombed Ukraine’s Odessa port. So everyone will be watching what happens in the Black Sea closely—it, quite literally, has global implications.


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Vol 55, No. 7, Aug 14 - 20, 2022