By Michelle Nichols
UNITED NATIONS (Reuters) – The United States would continue to do “whatever is necessary” to ensure Russia can freely export food if there was a revival of a deal allowing the safe Black Sea export of Ukrainian grain, U.S. Secretary of State Antony Blinken said on Thursday.
Russia last month quit the July 2022 deal brokered by the United Nations and Turkey aimed at easing a global food crisis after Russia’s invasion of Ukraine five months earlier. Ukraine and Russia are both leading grain exporters.
“In the event of return to the agreement, of course, we’ll continue to do whatever is necessary to make sure that everyone can export their food and food products freely and safely to include Russia,” Blinken told reporters at the United Nations.
“We want to see that food on world markets. We want everyone to benefit from the lower prices,” he said after chairing a U.N. Security Council meeting on food insecurity caused by conflict.
Many countries at the gathering expressed disappointment that Russia had quit the deal and urged them to reconsider.
To convince Russia to agree to the Black Sea deal, another pact was also struck in July 2022 under which U.N. officials agreed to help Russia get its food and fertilizer exports to foreign markets.
While Russian exports of food and fertilizer are not subject to Western sanctions imposed after Russia’s February 2022 invasion of Ukraine, Moscow has said restrictions on payments, logistics and insurance have hindered shipments.
During the Security Council meeting on Thursday, Russia’s Deputy U.N. Ambassador Dmitry Polyanskiy accused Western countries of an “arrogant unwillingness” to help fulfill the U.N. pact with Moscow.
He stressed that Russia held a larger share of the global wheat market than Ukraine and was a key fertilizer exporter.
“Western countries need to focus on ensuring that Russian grain and fertilizers can get to countries in need without hindrance,” Polyanskiy said.
PRICING PRESSURES
Blinken told reporters that Russia’s exports of food have exceeded levels prior to its invasion of Ukraine.
“Having said that, to the extent that there have been any problems with things like shipping and insurance, we have throughout the process of the Black Sea Grant initiative, taken steps to work through them and to address them,” he said.
This included writing comfort letters to banks “to assure them that it was fine to process these transactions and that they wouldn’t run afoul of our sanctions,” Blinken said.
U.S. bank JPMorgan (NYSE:) has processed some Russian grain export payments with reassurances from Washington.
The United Nations has argued that the Black Sea deal helped everyone because it brought prices down 23% from a record high in the weeks following Russia’s invasion of Ukraine.
After Moscow quit the deal, it began targeting Ukrainian ports and grain infrastructure on the Black Sea and Danube River, sending global grain prices soaring. Moscow has said it may resurrect the Black Sea agreement if its demands to improve its own exports of grain and fertilizer are met.
“If all the problems that have been publicly raised by us … are eliminated, we will be ready to once again take part in the Black Sea initiative,” Polyanskiy reiterated.
The European Union has warned developing countries that Russia is offering cheap grain “to create new dependencies by exacerbating economic vulnerabilities and global food insecurity,” according to a letter seen by Reuters on Wednesday.
Russian President Vladimir Putin told African leaders last week that Russia was ready to replace Ukrainian grain exports to Africa on both a commercial and aid basis to fulfill what he said was Moscow’s critical role in global food security.
Polyanskiy described the EU warning as “perverted logic,” adding: “Russia has never considered Africa, Asia or Latin America as a space for extracting profits.”
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