Why Deals To End Ukraine And Russia's Standoff Over Grain Is A 'Beacon Of Hope'

Blockades decimated "the breadbasket of Europe", pushing millions closer to famine and adding to soaring inflation worldwide.
<strong>Farmer Andriy Zubko checks wheat ripeness on a field in Donetsk region, Ukraine.</strong>
Farmer Andriy Zubko checks wheat ripeness on a field in Donetsk region, Ukraine.
via Associated Press

A much-anticipated deal to get grain out of Ukraine through the Black Sea has been agreed, amid hopes that the agreement can avoid a global food crisis.

Russia and Ukraine on Friday signed separate agreements with Turkey and the United Nations to clear the way for exporting millions of tons of desperately needed Ukrainian grain as well as Russian grain and fertiliser. The pacts are in effect a ceasefire at sea.

What’s the background?

Ukraine is sometimes referred to as “the breadbasket of Europe”, with 400 million people said to be dependent on importing the country’s wheat, corn, sunflower oil and other grain.

The five-month war has halted Ukrainian sea shipments and caused grain prices to rise dramatically. Some Ukrainian grain is being transported through Europe by rail, road and river, but the country’s agricultural industry has been decimated. In 2021, Ukraine collected 107 million metric tons of grain, but this year has managed to farm just 3.6 million so far.

Negotiations over a deal began in April when UN secretary general Antonio Guterres raised the idea in separate meetings with Russian president Vladimir Putin and Volodymyr Zelenskyy of Ukraine.

He proposed a package deal in early June amid fears that the war was endangering food supplies for many developing nations and could worsen hunger for up to 181 million people.

How has the world been impacted?

- Famine

Earlier this month, a UN official warned the spike in food, fuel and fertiliser prices sparked by the war in Ukraine is threatening to push countries around the world into famine, bringing “global destabilisation, starvation and mass migration on an unprecedented scale”.

The UN World Food Programme’s latest analysis shows that a record 345 million acutely hungry people are on the brink of starvation – a 25% increase from the start of 2022 before Russia invaded Ukraine.

Since the war began, prices for food staples have risen 187% in Sudan, 86% in Syria, 60% in Yemen and 54% in Ethiopia.

- Inflation and food prices

The spiralling price of vital commodities such as wheat and barley as a result of the war has been a major contributor factor to the cost of living crisis.

Britain’s inflation rate has risen to its highest level in 40 years, and the United States is reporting a near four-decade high rate. The 19 countries that use the euro have seen inflation records for months.

Grain is not to blame entirely. The war has had a big impact on energy prices, and other factors include production lockdowns in China and disruption caused by Brexit.

But products that rely on wheat – such as chicken, pork and bakery items – have been the worst affected by the war in Ukraine, with some fearing food price rises in the UK could hit 15% this summer.

<strong>Turkish president Recep Tayyip Erdogan, right, and UN secretary general Antonio Guterres lead a signing ceremony at Dolmabahce Palace in Istanbul, Turkey.</strong>
Turkish president Recep Tayyip Erdogan, right, and UN secretary general Antonio Guterres lead a signing ceremony at Dolmabahce Palace in Istanbul, Turkey.
via Associated Press

What will the deal do?

The deal aims to help avert famine by injecting more wheat, sunflower oil, fertiliser and other products into world markets including for humanitarian needs, partly at lower prices. It targets the pre-war level of 5 million metric tonnes exported each month. Ukraine also needs to empty its silos ahead of a coming harvest.

The UN and Russia also signed an memorandum of understanding committing the UN to facilitating unimpeded access of Russian fertiliser and other products to global markets.

How will the deal work?

The plan, known as the Black Sea Initiative, opens a path for significant volumes of commercial food exports from three key Ukrainian ports: Odessa, Chernomorsk and Yuzhny.

The deal makes provisions for the safe passage of ships through the heavily mined waters. A coordination centre will be established in Istanbul, staffed by UN, Turkish, Russian and Ukrainian officials, to monitor the ships and run the process through specific corridors. Ships would undergo inspections to ensure they are not carrying weapons.

A key element of the deal is an agreement by both Russia and Ukraine that there will be no attacks on any of the vessels. The agreement is for a renewable 120-day period.

 Cargo ships are docked in the Black sea port of Odessa, Ukraine, November 4, 2016. REUTERS/Valentyn Ogirenko
Cargo ships are docked in the Black sea port of Odessa, Ukraine, November 4, 2016. REUTERS/Valentyn Ogirenko
Valentyn Ogirenko via REUTERS

Will it have any impact?

The UN hopes so. Speaking at the signing ceremony in Istanbul, UN secretary general Guterres said: “Today, there is a beacon on the Black Sea. A beacon of hope... possibility...and relief in a world that needs it more than ever.”

“It will help stabilise global food prices, which were already at record levels even before the war – a true nightmare for developing countries,” he added.

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