Concluded in Istanbul on July 22, 2022, the Black Sea Initiative to export Ukrainian food products (suspended on July 17) has been receiving a lot of attention. It was part of a package deal along with the Russia-UN Memorandum on promoting Russian agricultural exports (in force until 2025), forming together the so-called grain deal. Against this backdrop, the Foreign Ministry considers that it must once again set forth Russia’s position in this regard, in detail.
It is well known that the Black Sea initiative failed to live up to its humanitarian mission since less than 3 percent of the 32.8 million tonnes of shipments went to the countries in need, while Ukrainians used it to attack Russian facilities. Its termination did not bring about a disaster of any kind. The global price of grain is steadily declining, having decreased in the range of 4 to 5 percent in August to reach levels 25 to 40 percent below its peak in March 2022, contradicting the alarmist statements by the West and the UN Secretariat on surging food prices and the imminent threat of hunger.
Overall, there is no global food shortage in physical terms, while there are challenges in terms of distributing, not producing, food. In other words, no one died of hunger when exports of Ukrainian grain by sea stopped and a food crisis never materialised, defying the predictions by the Western capitals and the United Nations. This did not come as a surprise, since 32.8 million tonnes of shipments, mostly fodder corn and forage grain, would hardly suffice to feed the planet.
Ukraine’s role as the world’s breadbasket has also been blown out of proportion, once again at the initiative of the West and the United Nations. In fact, this country accounts for a relatively small portion of global wheat exports at about 5 percent, and this share has become even smaller recently due to objective factors, considering, among other things, the decrease in the planted acreage as a result of soil contamination by radioactive and chemical toxins following the use of depleted uranium munitions supplied by the West. At the same time, Ukrainians can easily rely on shipping routes other than the Black Sea for exporting their produce, including the land and river routes to the EU, the so-called solidarity corridors.
Of course, this carries higher transport costs. In addition, the Europeans have been in no hurry to live up to their stated solidarity with Kiev. In May, the European Commission banned imports of Ukrainian grain, corn, canola and sunflower seeds to Poland, Slovakia, Hungary, Romania and Bulgaria, allowing only transit shipments through these territories. With this moratorium set to expire on September 15, Brussels will have a great opportunity to review its decision and lift the ban on Ukrainian grain imports which risk overwhelming the East European markets. It will also provide an opportunity to send Ukrainian grain for free to the African and Latin American countries that need it, considering that this is what causes so much concern in Washington and some European capitals. That said, we can hardly expect this to happen.
In these conditions, as Russia has pointed out many times and in detail, if the West and Kiev really need the Black Sea corridor, it is high time for them to take concrete steps to lift the illegal unilateral sanctions imposed on Russian entities which are involved in producing and exporting agricultural products and fertilisers. This includes restoring the normal operation of banks and companies, streamlining transport logistics and insurance, and resuming the supplies of machinery components. Not only does the Russia-UN Memorandum provide for addressing these systemic issues, but such action would be consistent with the bombastic statements by Americans and Europeans who have been claiming that their sanctions do not prevent Russian fertiliser and grain from reaching the global market.
However, instead of actual exemptions from sanctions, all Russia got was a new dose of promises from the UN Secretariat. This time, the UN Secretary-General and his experts have put forward what they presented as four breakthrough proposals: reconnecting a subsidiary of the Russian Agricultural Bank to SWIFT, creating an insurance platform, unblocking the foreign assets of Russian fertiliser producers and enabling our ships to enter European ports. In exchange, they want Russia to guarantee that the Black Sea Initiative resumes immediately and in full.
However, just like UN’s earlier suggestions, these recent proposals do not contain any new elements and cannot serve as a foundation for making any tangible progress in terms of bringing our agricultural exports back to normal.
It has been stated many times, including in our public comments, that there is no viable alternative when it comes to reconnecting the Russian Agricultural Bank to SWIFT, be it through its branches or subsidiaries, or by having JP Morgan process the transactions. By the way, this was a marginal tool to begin with and it stopped working after the demise of the Black Sea initiative. Just a few days before the Russia-Türkiye Summit in Sochi, Frankfurt’s Commerzbank notified the Russian Agricultural Bank that it had closed its euro-denominated correspondent account.
We have been hearing promises about setting up a dedicated insurance platform for Russian agricultural products since August 2022, but for some reason they have never materialised.
The same goes for allowing Russian ships and cargoes to enter foreign ports. The United Nations has not been able to address the relevant obstacles arising from sanctions – the entire Russian territory is viewed as a warlike and high-risk area, while specialised Russian transport and insurance entities and companies have been put on sanctions lists.
Moreover, fertiliser producers have been invited to recognise their sanctioned status as a way of unblocking their foreign assets in order to be able to ask for exemptions at their own risk.
It is obvious that all these superficial measures and workarounds are designed to imitate actual efforts without bringing about a real solution, i.e., lifting the sanctions and restrictions imposed on the relevant Russian economic entities. Sanctions have also been imposed on imports of components into Russia as these products are viewed as dual use goods. The United Nations has not even mentioned the need to address this systemic issue for the same reason.
The UN Secretary-General did not say anything about the Togliatti-Odessa ammonia pipeline, despite his special trip to Kiev on March 8 and a separate proposal of April 26. This pipeline supplied enough fertiliser to grow food for 45 million people. When Ukraine blew up the pipeline on the territory under its control, the UN Secretariat decided not to mention this, despite the fact that it was a central element of both Istanbul agreements.
Also, it remains an open question what the United Nations plans to do next to carry out the Russia-UN Memorandum given Antonio Guterres’ words about the UN not intending to withdraw from the agreement. However, the relevant efforts have been de facto suspended. UNCTAD’s Secretary-General Rebeca Grynspan who has been tasked with overseeing this agreement has had an invitation to visit Moscow since July 2023 in order to hold the next round of talks, but for now, even the regular performance reports have been suspended. That said, the United Nations is still represented in Istanbul’s Joint Coordination Centre even though the termination of the Black Sea Initiative deprived them of this mandate.
In this context, Russia reaffirms its position of principle as set forth by President Vladimir Putin on September 4. We stand ready to explore opportunities for reviving the Black Sea Initiative. However, this can happen only once all the requirements are met to lift sanctions imposed on the Russian companies dealing with agricultural products and fertilisers. It is obvious that so far nothing suggests that the Western countries will take any steps down this path, while Kiev has gone as far as to say that it will continue pushing for the imposition of even tighter sanctions on Russia, not caring in the least about the fact that the Global South needs grain and fertilisers, or about global food security in general.
For its part, Russia will continue exporting its food and fertilisers which will have a stabilising effect on global prices and improve the availability of these products. We will also persist with our efforts to supply our products for free to those who need them.
In particular, Russian fertiliser has already been sent to Malawi and Kenya with shipments of 20,000 tonnes and 34,000 tonnes, respectively. We intend to send 23,000 tonnes to Zimbabwe, 34,000 tonnes to Nigeria, and 55,000 tonnes to Sri Lanka soon. In addition to this, In addition to this, free shipments for a total of 200,000 tonnes of Russian wheat will be on their way to Somalia, the Central African Republic, Burkina Faso, Zimbabwe, Mali and Eritrea before the end of the year.
The joint project by Russia, Türkiye and Qatar to deliver 1 million tonnes of grain from Russia so that it can be processed in Türkiye and then delivered to the poorest countries for free has also been quite popular, especially considering that it matches, more or less, food shipments under the Black Sea Initiative to the neediest countries over a one-year period.
