Ukrainian Grain on Cargo Ship Reaches Romania

By John Mercury September 20, 2023

Ukraine took two bold steps toward securing export routes for its vital grain industry on Tuesday, sending a ship loaded with wheat along a new Black Sea route in the face of Russian naval aggression and challenging one of its main allies, Poland, over its opposition to Ukrainian imports.

In an initial success, the ship, the Resilient Africa, which is loaded with 3,000 metric tons of wheat, crossed the maritime border into Romanian waters on Tuesday evening. It arrived more than 12 hours after it left the Ukrainian port of Chornomorsk, according to the MarineTraffic website, which tracks global shipping using satellite data.

The importance of establishing a new sea route grew still greater this week in the face of a renewed dispute between Ukraine and its grain-producing European Union neighbors about overland exports.

But though the Resilient Africa appears to have navigated itself safely out of Ukrainian waters, experts say much uncertainty remains over whether the country will be able to rebuild a vital industry weighed down by 19 months of war.

The vessel, sailing under the flag of Palau, is the first grain ship to leave a Ukrainian Black Sea port since July, when Moscow terminated a deal that for a year had let Ukraine export its grain straight across waters dominated by Russia’s Black Sea fleet to Turkey and the Bosporus.

Under the new route, outlined by the government in Kyiv, ships will hug the coast before entering the waters of Romania and then Bulgaria — both members of NATO. Ukraine’s infrastructure minister, Oleksandr Kubrakov, described it as a corridor “established by the Ukrainian Navy.”

The risks are significant.

In July, Moscow warned that it would consider any commercial vessel approaching a Ukrainian port to be a potential carrier of military cargo. The following month, the Russian Navy fired warning shots at a cargo ship and then boarded it at gunpoint to conduct an inspection. And since July, Russia has bombarded the Ukrainian port at Odesa as well as the country’s Danube River ports, specifically targeting grain facilities.

Beyond that, the Black Sea itself is expanding as a theater of conflict between Ukraine and Russia, which launched its full-scale invasion of its neighbor in February 2022.

Amid attacks on military targets by both sides across large expanses of water, the success of Ukraine’s new export route may hinge on the willingness of commercial shipping companies to risk their vessels, according to Sal Gilbertie, the chief executive of Teucrium, a U.S.-based investment advisory firm.

“The corridor is a good idea, but I think it is a test of what the Russians will allow” in the Black Sea, he said.

Ukrainian officials say that Moscow’s effort to thwart their food crop exports is just one part of a wider Russian war on their economy that has run parallel with its invasion. Many Ukrainians say that the Kremlin’s ultimate objective is to crush their country as a nation state.

In the past 19 months, Ukraine, with the cooperation of the European Union, has increased its overland grain exports, as well as shipments from its ports on the Danube River. But the effort has been complicated by resistance from farmers in neighboring countries who say that Ukrainian crops arriving by road and rail are undercutting domestic producers.

In the latest clash, the governments of Poland, Hungary and Slovakia said this week that they would defy a decision by Brussels to lift a temporary ban on Ukrainian grain imports. In response, Ukraine filed a complaint with the World Trade Organization against the three countries.

The tension has particularly complicated Kyiv’s relationship with the government in Warsaw, one of its most hawkish backers.

With elections in Poland less than a month away, its conservative governing party, Law and Justice, which is ahead in the polls, has scrambled to shore up two vital pillars of support: voters deeply hostile toward Russia and proud of their country’s role as a pivot of Western support for Ukraine; and a rural base furious about competition from cheap Ukrainian grain.

Speaking on Monday after Kyiv filed its appeal with the World Trade Organization, Poland’s prime minister, Mateusz Morawiecki, pledged steadfast support for Ukraine but — blaming Russia for the grain crisis — also vowed to protect Polish farmers.

Poland, which insists it will not block transit of Ukrainian produce, only its sale on the domestic market, said it was “not impressed” by Ukraine’s appeal to the W.T.O. and would not change course. But it avoided polemical statements against Kyiv.

The Ukrainian authorities say they are keen to defuse the issue, and on Tuesday Prime Minister Denys Shmyhal outlined what he said was a “compromise scenario.”

“We have already presented the European Commission with an action plan to control the export of four groups of agricultural products from Ukraine,” he said on the Telegram messaging app.

Despite the Russian pressure on its export routes, Ukraine exported about five million tons of grain in July and August, a level similar to last year, when the grain deal was in effect, according to Andrey Sizov, the head of SovEcon, a Black Sea grain markets consultancy.

The figures mask longer-term Russian damage to Ukraine’s agricultural sector, experts said. One much-feared consequence of Russia’s decision to abrogate the grain deal, however, has not materialized, they said.

António Guterres, the United Nations secretary general, had warned that the end of the grain deal would exacerbate a hunger crisis faced by millions of people in countries including Afghanistan, Yemen and South Sudan.

But global wheat supplies have remained steady, Mr. Sizov said, a result, paradoxically, of large amounts of Russian wheat being exported across the Black Sea. And global wheat prices, which spiked at the start of the invasion, have remained broadly steady in recent weeks.

“The global market, too, is managing just fine without the grain deal,” Mr. Sizov said in an essay for the Carnegie Endowment for International Peace.

Andrew Higgins contributed reporting.


source

Leave a Reply

Leave a Reply

Your email address will not be published. Required fields are marked *