WASHINGTON —
A U.N.-led deal on Ukrainian grain exports was extended for 120 days on Thursday, aiming to ease the crisis of global food shortages by continuing to let Ukraine export food through its southern Black Sea ports. Moscow complained, however, that Russia's demands had not been fully met.
Russia and Ukraine, led by the United Nations and assisted by Turkey, reached an agreement in July this year to establish a protected transport corridor in the Black Sea, so that Ukraine, a major exporter of grain and rapeseed, can restore grain through three terminals on its Black Sea coast Exports, thereby alleviating the global food shortage crisis.
Guterres also said the United Nations was also "fully committed to removing the remaining obstacles to the export of food and fertilizers from the Russian Federation". This is also a clause that Russia regards as crucial in the agreement between the parties.
According to a Reuters report, the Russian Foreign Ministry confirmed that the Black Sea food agreement has been extended for 120 days from November 18, and that no changes have been made to the existing agreement.
But Reuters, citing two sources familiar with the matter, said there was no consensus on arrangements for Russia to export ammonia via pipeline to the Black Sea as part of a continuation of the deal. One of the sources noted that Russia will continue efforts to resume ammonia exports. Ammonia is an important raw material for the manufacture of fertilizers.
Ukrainian President Volodymyr Zelenskyy said in September that he would agree to allow Russia to resume ammonia exports through Ukraine only if Moscow returned Ukrainian prisoners of war, but his proposal was quickly rejected by Moscow.
"The extension of the Black Sea Food Initiative is great news for global food security and for developing countries," Rebeca Grynspan, Secretary-General of the United Nations Conference on Trade and Development, tweeted. She called it a "beacon of hope."
"Tackling the fertilizer crunch must be the next step," she said.
The United Nations and Ukraine had called for a one-year extension of the deal, but Russia insisted on a 120-day extension. Moscow said earlier this week that the current period for the extension of the agreement seemed "reasonable".
Russia’s invasion of Ukraine on February 24 this year, which led to a sharp drop in Ukrainian grain exports is one of the reasons for the global food crisis this year. Other reasons include the raging new crown epidemic and droughts in countries such as the United States and Argentina caused by climate change.
Since the parties agreed on the Black Sea Food Initiative in July this year, Ukraine has exported 11.1 million tons of agricultural products through the Black Sea Security Corridor, including 4.5 million tons of corn and 3.2 million tons of wheat.
Wheat prices in Chicago fell sharply after the agreement on the Black Sea Food Initiative was extended. The benchmark contract fell 2 percent, while corn shed 1.3 percent.
"This is bearish for the market, as remaining doubts are resolved and we have a clear outlook for the next four months," Reuters quoted a French trader as saying.
“But the deal is only extended for four months instead of a year as Ukraine has demanded and that means four months later uncertainty returns and people wonder if Russia will agree to an extension again.”
Both Russia and Ukraine are major grain exporters. Although the West has imposed severe sanctions on Russia, the export of grain and chemical fertilizers has not been directly restricted. But Moscow has complained that the sanctions make it difficult for Russian grain exporters to process payments, and to charter or insure grain ships.
Russia's foreign ministry said Moscow expected concerns about easing restrictions on Russian grain exports to be fully taken into account in the coming months.
“We note the increased efforts of the UN Secretariat to implement the commitments in this regard and the information provided to us on the phased results of lifting obstacles to Russia’s fertilizer and food supplies,” the Russian foreign ministry was quoted as saying by Reuters.
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