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BRUSSELS — Some 28 million metric tons of Ukrainian grain have been exported under the Black Sea Grain Initiative since last July, including to poor countries facing the brunt of the world’s spiraling food crisis.
But Russia is threatening to walk away from the pact, brokered by the United Nations and Turkey, unless its demands are met. The Kremlin is effectively threatening a return to the full-scale maritime blockade that halted Ukraine’s grain exports in the months after its full-scale invasion in February last year.
Foreign Minister Sergey Lavrov will meet with U.N. Secretary-General António Guterres in New York next week to discuss an extension of the deal beyond May 18.
The outlook is “not looking good,” the Kremlin has said, sparking speculation that the deal, which allows limited Ukrainian grain volumes to reach foreign buyers, will soon be dead in the water.
Ratcheting up the pressure, a letter from Russia to the Joint Coordination Committee of the Black Sea Grain Initiative, seen by POLITICO, warned that ship registrations would only continue until May 18.
It also appeared as a veiled threat that Russia’s military could start attacking commercial ships in the Black Sea after that date, no longer bound by the safe passage rules of the agreement. “It will make [it ]possible to avoid commercial losses and prevent possible safety risks,” read the letter, dated Wednesday.
Is Russia bluffing?
Moscow is seizing the moment now that both “Turkey and Ukraine are in a more vulnerable position than before,” said Yevgeniya Gaber, an Atlantic Council fellow and former Ukrainian diplomat.
The rhetorical escalation comes as Kyiv’s overland export corridors are threatened by import bans imposed by Eastern European countries led by Poland. At the same time, Turkish President Recep Tayyip Erdoğan faces a tough battle for reelection next month.
The U.N.’s ability to carve out a compromise is also hamstrung, after leaked Pentagon documents revealed that Guterres had faced U.S. criticism for being “too accommodating” toward Russia when the Black Sea deal last came up for renewal in March.
Ukrainian and Western officials have accused Russia of deliberately delaying inspections of grain-carrying ships in Turkish waters in order to inflate prices. As a rival food exporter, it stands to benefit.
“Russia is increasingly obstructing the operations of the Black Sea Grain Initiative, threatening the progress made on food accessibility over the last year,” a spokesperson for the U.S. National Security Council said. “It is imperative that Russia stop using the world’s food as a weapon in its war on Ukraine, which contributes to food insecurity around the world.”
‘Hidden’ sanctions
The Black Sea Grain Initiative was prolonged for a second time last month, but Moscow only agreed to continue its side of the bargain by 60 days — half the time originally foreseen.
The Kremlin said it will only consider extending the deal further if its demands are met. Chief among these is allowing Russia’s state agricultural bank to rejoin the international SWIFT payments system and lifting Western sanctions targeting Russian individuals, including fertilizer tycoon Dmitry Mazepin.
Moscow argues that these “hidden” sanctions hinder Russia’s food and fertilizer exports — despite a second agreement, introduced as a sweetener at the time of the Black Sea deal, for the U.N. to facilitate those Russian exports for three years.
“Nothing is moving, efforts are being made but unfortunately they are fruitless for us,” Russia’s U.N. Ambassador Vassily Nebenzia said Tuesday ahead of Lavrov’s visit to New York. “We clearly said we want to see progress.”
The West is unlikely to give in to Russia’s demands, however. The EU and U.S. maintain that their sanctions do not hinder Russian food or fertilizer exports.
The markets are not taking Moscow’s threats seriously — yet, according to Joseph Glauber at the International Food Policy Research Institute, a former chief economist at the U.S. Department of Agriculture.
“The market takes it with a pinch of salt,” said Glauber. “If there were indications that this was going to be abrogated, I think you’d see the market respond.”
Seizing the moment
It’s an opportune moment for Russia to try to milk concessions.
A row has blown up in Brussels after a group of Eastern EU member countries — until now Ukraine’s staunchest supporters — banned imports of Ukrainian farm produce.
When Russia’s invasion last year disrupted Ukraine’s main export route through the Black Sea ports, the EU lifted tariffs on a host of agricultural products and set up transit corridors — so-called solidarity lanes — through Bulgaria, Poland and Romania.
The objective was to stave off starvation in the Global South and prop up Ukraine’s battered economy. The result, however, has been a glut of cheap Ukrainian products disrupting local markets.
“Obviously, the Russians could not fail to take advantage of these nuances on the western [Ukrainian] border,” Ukraine’s Agriculture Minister Mykola Solskyi said after reaching a compromise on Tuesday in Warsaw to resume goods transit across Polish territory.
Ultimately, keeping the deal in purgatory suits the Kremlin. It gains more from sabotaging the Black Sea Grain Initiative from the inside, said Gaber of the Atlantic Council.
Under the agreement, inbound and outbound vessels must be inspected by all four parties: Ukraine, Russia, Turkey and the U.N. The Istanbul-based Joint Coordination Centre was set up to oversee this with the aim of clearing some 12 cargoes a day.
Down from an average of more than 10 a day last year, just two vessels have been inspected per day in April.
The Black Sea Grain Initiative is “under threat of shut down” because Russia is holding up ship inspections, Ukraine said on Monday.
“For the second time in 9 months of operation of the Grain Initiative, an inspection plan has not been drawn up, and not a single vessel has been inspected. This threatens the functioning of the Grain Initiative,” the restoration ministry said in a Facebook post.
Russia said on Tuesday that inspections had resumed, but the instability takes its toll both on Ukraine’s economy, which is reliant on agriculture, and global food prices.
“Even with the grain deal officially ongoing, we still have this obstruction, and we still have the declining capacity of the humanitarian and grain corridors,” Gaber said. “Which is, of course, threatening Ukraine’s interests, first of all, and global food security, secondly.”
Meredith Lee Hill reported from Washington. Bartosz Brzeziński contributed reporting from Brussels.
