The Ukraine grain deal brokered by Türkiye and the United Nations to resume exports offers hope and shows the significance of trade during times of crisis, according to a report by the global body published Thursday.
Türkiye, the U.N., Russia, and Ukraine signed an agreement in Istanbul on July 22 to resume grain exports from three Ukrainian Black Sea ports, which paused after the start of the Russia-Ukraine war in February.
Just before the U.N. report calling for the renewal of the deal was released, Russia's Ambassador to the U.N. in Geneva Gennady Gatilov countered what he called the Western mass media's "distorted, unbalanced picture."
At a news conference, Gatilov said the deal's extension depends "on ensuring full implementation of all previously reached agreements."
"The relative Russian authorities will be very seriously considering the future of the extension of this Grain Deal," he added.
The U.N. Trade and Development Agency (UNCTAD), which published the report, said: "The renewal of the U.N.-led initiative is vital to continuing to drive global food prices down and ensuring food security worldwide, especially in developing countries."
UNCTAD said that due to the initiative, port activity in Ukraine is picking up, and large shipments of grain are reaching world markets.
It said that as of Oct. 19, almost 8 million metric tons of grain and other foodstuffs have been exported.
"The U.N.-led Initiative has helped to stabilize and subsequently lower global food prices and move precious grain from one of the world's breadbaskets to the tables of those in need," the report said.
The Food Price Index published by the U.N. Food and Agriculture Organization has shown that the prices of global food staples have declined in recent months by about 8.6% in July, 1.9% in August, and 1.1% in September.
But with the initiative ending in November and its renewal uncertain, the prices of commodities, such as wheat and maize, are rising again, the report warned.
Without the initiative, there is "little hope" for providing food security, especially in developing and least-developed countries, it said.
UNCTAD said valuable grain corridors closed after Russia launched its war on Ukraine.
"There was a marginal recovery in subsequent weeks, but port departures remained considerably below their 2021 levels. After the signing of the U.N.-led initiative, there was a gradual rise in ship departures," the report said.
"While shipments are still about 40% to 50% below the pre-war period, the trend is in the right direction."
The weekly tonnage of grain shipped under the initiative reached 1.2 million tons by September. This is still below 2021 levels, but the gap is closing, said UNCTAD.
"The initiative reopened the grain gates of Ukraine to the world, and particularly to developing countries," the report said.
Maize and wheat account for over 70% of the 8 million tons of grain from Ukrainian ports under the initiative.
Nearly 20% of the wheat exports have gone to least developed countries (LDCs) with vulnerable populations.
The initiative doubled the wheat shipped to LDCs between August and September-about half a million tons.
But wheat exports to LDCs between January and September 2022 totaled less than 1 million tons.
Russia's Gatilov claimed that 55.5% of the cargo was delivered to financially developed rich countries and 52.5% to developed countries.
"In addition, 22% of the countries which are economically above average, not poor, and only 23% of the grain, corn and other foodstuffs were meant for poor countries," said the Russian envoy.
He said the World Food Programme had bought a mere 2.5% of the food supplies for its operations in Afghanistan, Djibouti, Ethiopia, Yemen, and Somalia.
"Therefore, the Western thesis that the Black Sea humanitarian corridor with the Green Deal saves the world from starvation is nothing but hypocrisy," the Russian envoy added.
The U.N. insisted that the deal, which expires on Nov. 19, is working and must be renewed before it expires next month, with prices already rising on the uncertainty.
The U.N. would like to renew the agreement for one year.
But Russia is unhappy with some aspects of the arrangements and how they work, fuelling doubt as to whether the Kremlin would want to carry on with the deal.
The deal helped push down historically high market prices, but they are rising again amid concerns about whether the initiative will be renewed.
"In a context where trade is very uncertain, signals matter very much," said UNCTAD chief Rebeca Grynspan.
"When there is no clarity, no one knows what is going to happen, and speculation and hoarding take over."
The Food Price Index, published by the U.N. Food and Agriculture Organization, shows that the prices of global food staples declined by about 8.6% in July, 1.9% in August and 1.1% in September.
Shipments are around 40%-50% below where they were before Russia's invasion of Ukraine.
Under the initiative, three seaports have been reopened: Odessa, Chornomorsk and Pivdennyi.
Russia, a world grain power, complains that it cannot sell its production and its fertilizers due to Western sanctions affecting the financial and logistics sectors in particular.
"The extension of the deal depends on ensuring full implementation of both previously reached agreements," he said.
In discussions with the U.N., "we have emphasized our concerns about the implementation of the Russian part of the deal, because we are still experiencing troubles with essential logistics."
"The extension of the deal depends on ensuring full implementation of both previously reached agreements," he said.
"There is no point in continuing an agreement, one part of which may come out as dead on arrival."
