Black Sea Grain Deal Revival Talks Underway

By Ryan Hanrahan

World-Grain’s Arvin Donley reported Monday that “Russia is expressing interest in resuming the Black Sea Grain Initiative as part of its discussions with the U.S. on March 24 in Saudia Arabia regarding a potential ceasefire with Ukraine, Reuters reported.”

“The deal, which originally was brokered by the United Nations and Turkey, allowed safe passage of Ukrainian grain out of its Black Sea ports during the Russian-Ukraine conflict, which began in February 2022 and has been fought mostly on Ukrainian soil,” Donley reported. “The deal was signed in the summer of 2022 following five-month blockade of grain exports from Ukraine’s sea ports. The agreement lasted until the summer of 2023 when Russia pulled out of the deal claiming key aspects of it were never implemented.”

“Since then, Ukraine has circumvented the Russian blockade by using an alternative sea route as well as increasing international shipments by river, rail and road. Commercial vessels have traced the Black Sea’s western coast, along the borders of friendly states such as Bulgaria and Romania,” Donley reported. “It is difficult for Russian submarines to maneuver in the shallow waters, and the shipping lane, near NATO territory, raises the possibility of a military confrontation between Russia and NATO countries.”

Andrey Sizov of the Sovecon consultancy said on the social media platform X, however, that a new Black Sea grain deal would just be “business as usual — with better PR.” That’s because Ukraine’s grain is already flowing without Kremlin approval and the Black Sea is currently functioning, he said. That means any agreement would likely just “formalize the status quo,” while the countries could “declare a heroic win for global food security.”

“Kremlin spokesman Dmitry Peskov told reporters on March 24 that transportation safety was just part of the original deal,” Donley reported. “‘This is primarily about safety of navigation, but if you remember the initiative in its previous form, there was a large (number) of the obligations to our country that were not fulfilled last time,’ Kremlin spokesman Dmitry Peskov said, according to Reuters.”

Russia Says Original Black Sea Grain Deal Not Fulfilled

Reuters’ reported on Monday that “what Moscow saw as key parts of an earlier agreement (made in 2022) on the subject were never implemented.”

“Russia withdrew from the agreement in 2023, complaining that its own food and fertilizer exports faced serious obstacles, though Russia is not currently facing serious problems getting its grain to market by the Black Sea,” Reuters reported. “To convince Russia to agree to the Black Sea deal, a three-year memorandum of understanding was struck in July 2022 under which U.N. officials agreed to help Russia get its food and fertilizer exports to foreign markets.”

“While Russian exports of food and fertilizer are not subject to Western sanctions, Moscow has said restrictions on payments, logistics, and insurance have amounted to a barrier to shipments,” Reuters reported. “Russia wanted a resumption of its ammonia exports and the reconnection of its state agricultural bank Rosselkhozbank to the SWIFT international payments system.“

Black Sea Grain Deal Revival Talks Underway was originally published by Farmdoc.