(Bloomberg) — A United Nations-brokered deal allowing exports of Ukrainian grain from the Black Sea will be extended, all sides confirmed Thursday, easing pressure on global food prices.
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Ukraine’s Infrastructure Minister Oleksandr Kubrakov said on Facebook that a decision to renew the accord for 120 days was reached in Istanbul, where talks have been held. Russia later confirmed the deal will be prolonged without any changes, Tass reported. Turkey echoed the plans, and the UN welcomed “the agreement by all parties.”
That will keep crop shipments flowing from one of the world’s biggest grain and oilseed shippers, bolstering strained world supplies and benefiting Ukraine’s war-torn economy. Chicago wheat futures fell about 2% on the news, and corn and soybean oil retreated.
Ukraine still wants the deal extended by a whole year, and with one more port added to the accord, Kubrakov said; a response is awaited. President Volodymyr Zelenskiy said that Russian exports of ammonia through its territory — a condition that Moscow has pressed for — could only be allowed if the Kremlin agrees to exchange all war prisoners.
The original pact, struck in late July, revived seaborne exports from Ukraine after Russia blockaded the country’s ports following its invasion. It was brokered by Turkey and the UN with Ukraine and Russia and signed for an initial 120 days, which are due to run out Saturday. The deal provided for an automatic extension for the same duration unless one of the parties decided to pull out or modify it.
Ukraine has shipped more than 11 million tons of crops through the Black Sea since the deal came into force, led by corn and wheat cargoes. The grain has headed across Asia, Europe and Africa, including some cargoes chartered by the World Food Programme.
Still, its harvests and infrastructure continue to be hampered by Russia’s invasion. The country has also been barraged this week by a fresh round of missile attacks.
Last month, Russia briefly suspended its participation in the pact, but after the UN, Turkey and Ukraine vowed to continue anyway, started observing it again.
President Vladimir Putin had complained that the deal didn’t do enough to ease exports of Russian grains and fertilizer, even though they aren’t subject to sanctions and shipment volumes rose.
The UN said it is “fully committed to removing the remaining obstacles to exporting food and fertilizers from the Russian Federation.”
–With assistance from Volodymyr Verbyany, Ugur Yilmaz and Greg Sullivan.
(Adds Russia in second paragraph.)
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