Ukraine has demanded that the deal that eases Russia’s blockade on its Black Sea grain exports be extended to other products such as metals after the first successful use of the route.
Taras Kachka, trade negotiator and Ukrainian deputy economy minister, said he hoped the agreement between Ukraine and Russia allowing grain traffic to resume would hold and suggested it could serve as a model for other commodities, as traders and exporters are “still testing the limits”. ”.
“This agreement is about logistics, the movement of ships across the Black Sea,” he said. “What is the difference between grain and iron ore? »
Kachka spoke after the Lebanon-bound Razoni, which had been stuck in Odessa since Russia began its full invasion of Ukraine, smashed its way through Russian and Ukrainian mines laid at sea and passed the inspections in Turkey.
More than a dozen ships carrying grain wait to leave Ukrainian ports, while another ship heads for the Ukrainian port of Chornomorsk.
As part of the UN-brokered deal with Turkey, Russia agreed not to attack ships carrying food and fertilizers while it could – with officials from Ukraine, Russia, Turkey and the – inspect ships at a location in the Bosphorus Strait.
Ukraine is the world’s fifth largest wheat exporter and some vulnerable countries like Lebanon, Syria and Somalia depend on it for the majority of their wheat imports.
The tentative resumption of the Black Sea trade route has raised hopes that some 20 million tonnes of wheat, corn and other grains trapped in Ukraine could reach world markets and bring income to Ukrainian farmers before the winter planting season.
Mykhailo Podolyak, senior adviser to Ukrainian President Volodymyr Zelenskyy, said the deal was likely to hold “for some time” as long as it also served Russia’s economic interests.
“It seems to me that these [sea] for a while the caravans will be going back and forth, alongside the Russian caravans, who also want to ship their grain,” he said. But he warned: “Russia will look for a way to block all this again. This is my DIY pessimistic and optimistic scenario.
Podolyak and other members of the Ukrainian government believe that Russia agreed to this plan because its invasion of Ukraine did not go according to Moscow’s schedule. Russia had planned to take the ports of Odessa and Mykolayiv to gain control of export routes in the Black Sea region, Podolyak said.
Russia welcomed the agreement. “This is not a one-time mechanism but a mechanism designed to ensure the export of grain that has accumulated in these ports,” Kremlin spokesman Dmitry Peskov said Thursday. “Therefore, we hope that this mechanism will continue to work just as effectively.”
Oleg Ustenko, Zelenskyy’s economic adviser, said lifting the blockade could help avert an economic calamity. Before the war, the majority of Ukrainian exports transited through the Black Sea, he estimated.
However, increased post-war logistics costs resulting from efforts to redirect exports by rail or road made Ukrainian products uncompetitive in the global market, he added.
“It was part of the plan.[by Russia]. . . to weaken the Ukrainian economy,” he said.
The only sunflower seed product that Kyiv has been able to export regularly since the start of the war is non-edible grade sunflower oil, with around 300,000 tonnes trucked in for blending into fuels in Europe.
The country managed to export around 3 million tonnes of grain via road, rail and the Danube last month, Kachka said, less than half of the volumes exported mainly via the Black Sea before the war. Ukraine estimates it will harvest 67 million tonnes of grain this year, up from a record 86 million tonnes in 2021.
Even with a loosened blockade of the Black Sea, Ukrainian farmers will be planting cautiously this winter, Kachka said.