The Kremlin announced that Russia has withdrawn from the Black Sea grain export agreement, causing wheat prices to rise.
This agreement, orchestrated by the United Nations and Turkey last July, was implemented to mitigate a worldwide food shortage by ensuring the safe export of Ukrainian grain amidst the conflict in Ukraine initiated by Moscow.
Despite numerous extensions, the deal was set to end today. Russia has been asserting for several months that the prerequisites for its continuation had not been met.
The Kremlin declared that, in practical terms, the agreement has effectively terminated.
The Kremlin has confirmed that Russia has discontinued its involvement in the Black Sea grain export agreement, which has subsequently led to a rise in wheat prices.
Last July, the United Nations and Turkey facilitated the deal with the intention of mitigating a worldwide food crisis. The agreement was designed to ensure the secure export of Ukrainian grain while the Ukraine-Moscow conflict persisted.
The deal, which had been extended multiple times, was set to lapse today. Russia had been indicating for some time that the preconditions for its prolongation were not satisfied.
The Kremlin indicated that the agreement has essentially come to an end.
This development coincides with Russia accusing Ukraine of launching a drone attack on the Crimean Bridge overnight, which reportedly resulted in two casualties.
The termination of the deal has triggered a sharp increase in wheat prices, with the most active contract on the Chicago Board of Trade rising 6.7% to $6.89 per bushel.
Both Russia and Ukraine are among the world’s leading agricultural producers, playing significant roles in the wheat, barley, maize, rapeseed, rapeseed oil, sunflower seed, and sunflower oil markets. Russia also maintains a dominant position in the fertilizer market.
Martin Devenish, the Head of Corporate Intelligence at S-RM, commented, “The failure to renew the deal now puts the global south in a vulnerable situation, with an imminent risk that existing famines could deteriorate and extend.”
