An agreement for shipping grain from Ukrainian ports through the Black Sea will be signed on Friday evening with the participation of Russia, Ukraine, the United Nations and Turkey, the Turkish presidency said yesterday.
Turkish president Recep Tayyip Erdogan and UN secretary-general Antonio Guterres are expected to attend the signing ceremony, which will be held at the Dolmabahce Presidential Office in Istanbul at 18.30 hrs local time.
Istanbul will become an operational hub where the entire shipping process will be carried out, Turkish officials have said, while insurers have stressed that any agreement will need to include naval escorts and guarantees that sea mines are cleared, a tricky exercise given how many have been laid in recent months.
Ukraine’s seaports have been closed from day one of Russia’s invasion nearly six months ago, leading to a growing food crisis as the country has struggled to find suitable export routes to shift last year’s harvest from its silos while readying this year’s crop.
Using AXS data, prior to the war, Russia typically exported about 3-5m tons of grains a month while Ukraine exported about 5-7m tons a month.
Having eked out some alternative river and rail routes, Ukraine is currently moving just 1.5-2m tons of grain a month, according to AXS estimates.
Russian wheat exports this month are similarly sluggish with volumes standing around 1.5m tons against the historical July average of 2.6m tons of shipments with the Black Sea a serious danger zone strewn with mines.
“Considering the Russian new record-high crop arrival and the country’s intention to export about 40m to 45m tons of wheat this new season, Russia seems to have some incentives to reach an agreement to unblock the Ukrainian grain exports and simultaneously boost its own grain and fertilizer exports,” a new report from BRS states.