Slowing fertilizer exports
Russia makes demand for grain deal
11/12/2022 10:22 p.m
The agreement that allowed millions of tons of grain to be exported from Ukraine across the Black Sea despite the war expires next week. However, the export of Russian mineral fertilizers agreed in return has stalled. Moscow and the UN are calling for this to change.
A week before the expiration of the agreement on exports of Ukrainian grain, there are no signs of an extension of the contract, which is important for global food prices. The talks with representatives of the United Nations in Geneva were useful, but the question of an extension is still open, the Russian news agency TASS quoted Deputy Foreign Minister Sergei Vershinin as saying. He demanded that Russia’s state-owned Rosselkhoz Bank be exempted from Western sanctions and reconnected to the SWIFT international payment system. There can be no progress before then.
According to the UN, ten million tons of grain and other foodstuffs have been exported since the grain agreement came into force in July. As a result, the global food crisis was dampened by skyrocketing prices. Ukraine is one of the largest grain exporters in the world. The agreement, brokered by the UN and Turkey and limited until November 19, allows grain freighters to pass through the Black Sea, which is controlled by the Russian Navy.
The July agreement, which was mediated by the UN and Turkey, consisted of two agreements: in addition to Ukrainian exports, it was also about Russian food and fertilizers being exported despite Western sanctions. But that turned out to be difficult: while the sanctions don’t directly target these exports, their existence makes it difficult for Russian actors to call at European ports, process payments and get insurance for their ships.
The UN called on countries around the world to remove these obstacles to fertilizer exports from Russia. “The world cannot afford for global fertilizer availability problems to lead to global food shortages,” the United Nations said after talks with Vershinin and his delegation in Geneva.
Vershinin said payments for international Russian grain exports could only be processed once Rosselkhoz Bank was again part of SWIFT. Like Ukraine, Russia is also a leading international grain producer.
Freighters with Russian cargo are stuck
Ukraine sought support in the negotiations from the Southeast Asian community of states, ASEAN, among others. Ukrainian Foreign Minister Dmytro Kuleba called on member states to urge Russia to continue the grain deal, which expires in a week. “I call on all ASEAN members to take every possible measure to prevent Russia from playing the hunger games with the world,” Kuleba told reporters in the Cambodian capital of Phnom Penh.
In addition to grain, deliveries of fertilizers from Russia are also important, especially for poorer countries. Freighters loaded with Russian fertilizer are currently stuck in the Netherlands, Estonia and Belgium. They are now supposed to sail to Africa, reported TASS, citing the fertilizer manufacturer Uralchem-Uralkali. The agency quoted Uralchem boss Dmitry Konyaev as saying that the group was working with the United Nations to organize free shipments to Africa of more than 262,000 tons of mineral fertilizers that had been seized in EU countries.
The Netherlands announced on Friday that, at the request of the UN, it intends to authorize the shipment to southeast Africa’s Malawi of 20,000 tons of Russian fertilizer being held in the port of Rotterdam amid sanctions against an unnamed Russian person. A condition of the agreement is that the sanctioned person and the Russian company do not earn anything from the transaction. TASS quoted Konyaev as saying deals had been made to export fertilizer stranded at ports in the Netherlands, Belgium and Estonia. However, he did not name the quantities from the individual countries or the African destinations.