Turkey still hopes for an extension of the grain deal with Ukraine

Turkey is hoping a grain export deal between Kiev and Moscow, crucial to easing a global food crisis, can be extended for another 120 days – but time is running out.

The current deal expires shortly before midnight Istanbul time on Saturday.

“The deadline is approaching,” Turkey’s Defense Minister Hulusi Akar said on Friday.

“We are in contact with both Ukraine and Russia to extend the agreement on its original terms.”

During Russia’s full-scale invasion in February 2022, Ukraine’s Black Sea ports were blocked by warships.

But a deal brokered by Turkey and the United Nations in July 2022 and signed by Kyiv and Moscow has allowed the safe passage of exports of critical grain stocks.

Ukraine has been one of the world’s top producers, and the so-called Black Sea Grain Initiative has helped alleviate global food shortages caused by the conflict.

The original terms Akar was referring to – according to the deal – said the 120-day extensions would be automatically extended for the same period unless either party says otherwise.

The original agreement was extended in November to March 18 and should – in theory – be extended for another 120 days after it expires at 23:59 Istanbul time (2059 GMT) on Saturday.

But on Monday, after meeting senior UN officials in Geneva, Moscow announced a proposal to extend the deal by just 60 days.

Kiev was quick to make its displeasure clear, pointing out that the proposal strayed from the deadline set in the original deal, although Ukrainian officials were careful not to flatly reject it.

As of Friday, no one could say with certainty what would happen after the deadline.

“We very much hope that the initiative will continue and that the ships will keep flowing,” said Stephane Dujarric, spokesman for UN Secretary-General Antonio Guterres.

– Moscow’s demands –

Moscow decided to shorten the deal’s extension amid concerns that a parallel deal on Russian food and fertilizer exports would not be honored.

According to this agreement, also signed with the United Nations in July 2022, these products should be exempt from the sanctions imposed by Kiev’s allies against Russia.

But that didn’t happen, Moscow complained.

“Our further stance will be determined by the tangible progress in normalizing our agricultural exports, not (in) words but in deeds,” said Deputy Foreign Minister Sergei Vershinin, who led the Russian delegation at talks with UN officials on Monday

These include “bank payments, transport logistics, insurance and the release of financial activities and ammonia supplies through the Tolyatti-Odessa pipeline,” he said.

In response, Ukraine’s infrastructure minister Oleksandr Kubrakov said that “Russia’s position to extend the agreement for only 60 (days) contradicts the document signed by Turkey and the United Nations.”

“We are awaiting the official position of (the UN and Turkey) as guarantors of the initiative,” he said on Twitter.

– ‘risk factor’ –

The UN has said since Monday it is doing everything in its power to salvage the deal that has helped stem the skyrocketing food prices since Russia invaded Ukraine.

On Friday, the UN humanitarian chief, Martin Griffiths, reiterated that message.

“We continue to work closely with all parties,” he said.

At the same time, they spared “no effort” to solve the problems that Russia had raised because of its agreement.

More than 29.1 million tons of grain have left Ukrainian ports since the original deal was signed last July, while only a fraction of the 260,000 tons of Russian fertilizers stored in European ports have been released.

In the meantime, the prices for wheat and corn are back to the pre-war level, but oilseeds such as rapeseed and sunflowers are significantly lower.

“Right now the market is betting that it will get a 120-day extension,” Edward de Saint-Denis, a grain trader at Plantureux, told AFP.

“If that is the case, the 60 days proposed by Moscow will be used to continue negotiations for a longer extension.”

But Michael Zuzolo, president of Global Commodity Analytics and Consulting, said 60 days is “not enough to charter a vessel and insure its cargo”.

And if the deadline passes without a clear agreement on an extension, “it becomes a risk factor,” said Sebastien Poncelet, an analyst at agricultural market specialist Agritel.

“The markets will take that into account,” he said.


Source : news.yahoo.com

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