Fear and suspicion haunt Putin’s Black Sea grain deal with Ukraine

Fear and suspicion haunt Putin’s Black Sea grain deal with Ukraine

A U.N.-backed plan to allow Ukrainian food exports to navigate Russia’s Black Sea blockade has raised hopes that the worst ravages of a global food crisis can be avoided.

But Ukrainian and Western officials are skeptical that Moscow will stick to the final deal. They believe it’s likely that President Vladimir Putin will “weaponize” grain shipments in future, slowing them down again to gain leverage. 

On Friday, Russia and Ukraine signed an agreement with the U.N. and Turkey that should allow grain ships to circumvent Russia’s naval blockade of three ports around Odesa. The aim is to allow much more of Ukraine’s vast food exports to reach hungry nations around the world.

“Traders believe that any deal will work. So from [a] commercial point of view it is for the good,” Taras Kachka, deputy economy minister of Ukraine, wrote in a message to POLITICO. But he was wary of the Kremlin’s intentions for agreeing to the deal. “No one knows Russia’s motivation,” he added.

Oleksiy Goncharenko, a Ukrainian MP representing Odesa, was cautiously optimistic but said he expected Putin would eventually “try to make a bottleneck” of the sea corridor “to make it slow and vulnerable.”

That would enable Russia “at any moment” to restart the blockade, Goncharenko said in an interview after meetings with U.S. lawmakers in Washington on Thursday. “Putin is weaponizing everything. So he will definitely weaponize this.”

There are plenty of reasons why Ukrainians are suspicious. Ukraine’s Interfax news agency reported Friday that Russia had stolen 70,000 tons of grain — equivalent to one giant Panamax grain ship — from the Luhansk region. 

The international community stressed that the agreement must be followed up quickly with action, even as the U.N. and others welcomed the deal. The EU’s foreign affairs chief Josep Borrell said the success of the deal “will depend on the swift and good faith implementation.”

But privately, key Western officials doubt that grain will start moving quickly through the new safe corridor. “We’re not holding our breath,” one U.S. official said. An EU official added: “Clearly we need to see grains flow onto international markets to judge success.”

Others have been blunter, such as Germany’s Agriculture Minister Cem Özdemir who this week likened trusting Putin to free the Black Sea to believing in Santa Claus or the Easter Bunny.

“The jury is still out and Russia is attacking Ukraine as we speak,” said Volodymyr Dubovyk, associate professor of international relations at Odesa I. I. Mechnikov National University. “I’ve seen too much in these last five months and before that for years and I remain skeptical.”

In a sign of the depth of mistrust between the two warring countries, they did not even sign the same piece of paper. Instead, two mirror agreements were reached, which both Russia and Ukraine signed separately with the U.N. and Turkey.

Pain in the bottleneck

Potentially, the deal unlocks a portion of some 20 million tons of Ukrainian grain that have sat in silos since Russia’s invasion, unable to be exported. Ukraine’s farmers are already under pressure to find space to store the harvest from this summer.

“On our side everything is almost ready,” said Roman Slaston, the general director of the Ukrainian Agribusiness Club. “So yes, we need to get people back into these ports but it shouldn’t be a big problem.”

Still, it’s unclear if shipping companies will feel confident enough to restart their exports from Ukraine — especially because fighting could flare up in the Black Sea at any time. The ships will also need insurance.

“Everything will depend on the number of vessels that will come to the ports,” Slaston said. “That will be the biggest challenge for the next few months.” He estimated that shipments could restart maybe around the middle of August and reach up to four million tons per month — far more than the 2.5 million that managed to be exported by road and rail routes in June.

Ukraine’s war-torn economy would benefit from being able to feed the world again. But Russia’s invasion will make it hard to ramp up food exports immediately. Although the deal covers three ports — Odesa, Yuzhne and Chornomorsk — which made up two-thirds of Ukraine’s normal sea exports — it excludes the major southern port city of Mykolaiv, which Russia has been shelling.

“There is a lot of damage to the internal infrastructure and it will be problematic to restore the old routes for transporting large volumes of grain,” said Andriy Kupchenko, head of business projects unit at agricultural consulting firm APK-Inform. 

“Secondly, the main part of [the] railway fleet is located near the borders with the EU and time will be needed to bring them back for transportation towards ports.”

Years of damage

In an indication that Russia is likely to flaunt the deal as a humanitarian move, Russian Foreign Minister Sergey Lavrov will embark on a tour of Africa on Sunday, visiting the Democratic Republic of the Congo, Uganda, Ethiopia and Egypt — countries heavily dependent on wheat imports from Russia and Ukraine.

Moscow has maintained that the spike in global food prices is largely the fault of Ukrainians for mining around their ports to prevent Russian attacks, and the West for its sanctions.

Wheat prices dropped on the announcement of the deal but the global food crisis is far from over.

“The consequences of this current war in Ukraine will be felt at least for a couple of years,” said Alvaro Lario, the incoming president of the International Fund for Agricultural Development (IFAD), a U.N. agency based in Rome that works in 90 countries from Afghanistan to Yemen.

Lario said IFAD has been dealing with the consequences of the drought in East Africa, the pandemic recovery, a food price spike and climate change shocks pushing rural communities into poverty.

“We’re talking about decades of underinvestment, even if this is resolved,” he said in an interview. “This is only one shock. This is only one crisis.” 

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The post Fear and suspicion haunt Putin’s Black Sea grain deal with Ukraine appeared first on Politico.

Last Update: Fri, 22 Jul 22 15:47:07