The Black Sea Grain Initiative has been critical to ensuring that countries in Africa and Asia don’t run out of food. In this week’s blog CEO Dryad Global Corey Ranslem brings us up to speed on what lies ahead as we face the expiration date of the UN / Turkey brokered grain deal between Russia and Ukraine.
The initial agreement ran for 120 days starting from 22 July and was renewed in November for another 120 days, expiring on 18 March inclusively. The estimated export capacity of the three ports covered by the agreement is estimated between 2 million metric tons up to 5 million per month.
For real-time updates on the Black Sea Grain Initiative take a look at Dryad Global’s ARMS platform: https://www.dryadglobal.com/risk-intelligence
The Black Sea Grain Initiative was launched in Istanbul by the Russian Federation, Türkiye, Ukraine and United Nations on 22 July 2022. Through this initiative, a mechanism was established for the safe exports of grain, related foodstuffs and fertilizer, including ammonia, from designated Ukrainian ports to global markets.
The Initiative specifically allows for commercial food and fertilizer (including ammonia) exports from three key Ukrainian ports in the Black Sea – Odesa, Chornomorsk, Yuzhny/Pivdennyi.
A major global grain grower and exporter, Ukraine's grain exports were down 28.7% at 30.3 million tonnes in the 2022/23 season as of Feb. 20, hit by a smaller harvest and logistical difficulties caused by the Russian invasion.
Ukraine exports around 3 million tonnes of agricultural products a month under the deal, but Vaskov said Ukraine was able to export 6 million tonnes a month from the ports of Odesa region and boost it to 8 million tonnes if Mykolaiv joins.
Despite a decrease in the 2022 grain harvest to around 54 million tonnes from a record 86 million in 2021, at least 30 million tonnes of grain are still in silos and could be exported.
The purpose of the Initiative is to contribute to the prevention of global hunger, to reduce and address global food insecurity, and to ensure the safety of merchant ships delivering grain and foodstuffs.
To facilitate the implementation of their Initiative, the Joint Coordination Centre (JCC) was set up in Istanbul on 27 July 2022, under the auspices of the United Nations, comprised of senior representatives of Türkiye, the Russian Federation, Ukraine, and the United Nations.
The International Association of Dry Cargo Shipowners, (INTERCARGO) has been one of the leading voices in urging members of the Joint Coordination Centre for the Black Sea Grain Initiative to further extend this important humanitarian initiative when the current extension expires on March 18th.
The agreement also calls for the facilitation of safe navigation for exports of fertilizers, including ammonia. These shipments have not yet commenced, and INTERCARGO warns that they are essential to avoid a global food availability crisis in 2023 due to continued high fertilizer prices. Those who find themselves in the most need should not be paying the highest price in this conflict.
As uncertainty continues, INTERCARGO is reminding all operators of the importance of using all resources available to ensure safety of navigation and to continue to put the safety of bulk carrier crews to the forefront of any commercial decision.
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