Another 3 ships with grain depart from the ports of Ukraine under the UN agreement

Three more ships carrying thousands of tons of corn have left Ukrainian ports, officials said Friday, in the latest sign that a negotiated deal to export corn trapped since Russia invaded Ukraine nearly six months ago is underway. slowly becoming concrete.

But there are major obstacles to be faced in getting food to the countries that need it most.

Ships bound for Ireland, the UK and Turkey follow the first cargo of grain to cross the Black Sea since the start of the war. The passage of that ship bound for Lebanon earlier this week was the first as part of the revolutionary deal brokered by Turkey and the United Nations with Russia and Ukraine.

The Black Sea region is dubbed the granary of the world, with Ukraine and Russia key global suppliers of wheat, corn, barley and sunflower oil that millions of poor people in Africa, the Middle East and parts of Asia rely on for survival. .

Although the shipments have raised hopes of easing a global food crisis, much of the grain Ukraine is trying to export is used for animal feed, not for human consumption, experts say. The first ships to leave are among more than a dozen bulk carriers and merchant ships that had been loaded with grain but stranded in ports since Russia invaded in late February. And the cargoes are not expected to have a significant impact on the global price of corn, wheat and soy for several reasons.

Slow start

For starters, exports under the deal are starting slowly and cautiously due to the threat of explosive mines floating off Ukraine’s Black Sea coast.

And while Ukraine is a major exporter of wheat to developing countries, there are other countries, such as the United States and Canada, with much higher production levels that can affect global wheat prices. And they face the threat of drought.

“Ukraine accounts for about 10 percent of the international grain trade, but in terms of production it’s not even five percent,” said David Laborde, an agriculture and trade expert at the International Food Policy Research Institute in Washington. .

The three ships left on Friday with over 52,600 tons corn, but that’s still a fraction of the 18 million tons of grain that Ukraine says are trapped in the country’s silos and ports and that need to be shipped to make room for this year’s crop.

About six million tons of trapped wheat is wheat, but only half is destined for human consumption, Laborde said.

Ukraine is expected to produce 30% to 40% less wheat in the next 12 months due to the war, although other estimates put that figure at 70%.

High prices

Cereal prices peaked after the Russian invasion, and while some dropped to pre-war levels, they are still higher than before the COVID-19 pandemic. Corn prices are 70% higher than at the end of February 2020, said Jonathan Haines, senior analyst at data and analytics firm Gro Intelligence. He said wheat prices are around 60% higher than in February 2020.

One reason why prices remain high is the impact of drought on crops in North America, China and other regions, as well as the higher price of fertilizers needed for agriculture.

“When fertilizer prices are high, farmers can use less fertilizer. And when they use less fertilizer, they will produce less. And if they produce less, supply will continue to remain insufficient,” Laborde said.

The three ships that left Ukraine on Friday give hope that exports will increase to developing countries, where many are facing the growing threat of food shortages and hunger.

“The movement of three more ships overnight is a very positive sign and will continue to build confidence that we are moving in the right direction,” said Haines. “If the flow of grain from Ukraine continues to expand, it will help ease global supply constraints.”

The Polarnet flying the Turkish flag, carrying 11,000 tons of corn, left the port of Chornomorsk for Karasu, Turkey. Navi Star flying Panama left the port of Odesa for Ireland with 30,000 tons of corn. The Maltese-flagged Rojen left Chornomorsk for the UK carrying over 11,700 tonnes of corn, the UN said.

The Barbadian-flagged general cargo ship Fulmar S is pictured in the Black Sea, north of the Bosphorus Strait, in Istanbul, Turkey, on Friday. (Yoruk Isik / Reuters)

He added that the Joint Coordination Center – run by officials from Ukraine, Russia, Turkey and the United Nations who oversee the agreement signed in Istanbul last month – cleared the three ships and inspected a ship bound for Ukraine. The Fulmar S, flying the Barbadian flag, has been inspected in Istanbul and is bound for the port of Chornomorsk.

Controls aim to ensure that outgoing merchant ships carry only grain, fertilizer or food and no other goods and that incoming ships do not carry weapons. The ships are accompanied by Ukrainian pilot ships for safe passage due to the explosive mines scattered in the Black Sea.

After Turkey, which has relations with both Russia and Ukraine, helped broker the food deal two weeks ago, President Recep Tayyip Erdogan reportedly met with Russian President Vladimir Putin later on Friday in Sochi, Russia. . That meeting follows another face-to-face meeting the two leaders had in Iran three weeks ago.