Despite Resumption of Black Sea Grain Exports, Ukrainian Farm Export Problems Persist

Reuters writer Pavel Polityuk reported yesterday that, “Inspections of ships carrying Ukrainian grain from the Black Sea resumed on Wednesday under a U.N.-brokered deal but Kyiv faces a struggle to secure an extension of the agreement, as well as a widening import ban in eastern Europe.

“Bulgaria became the fourth European Union member state in the region to block Ukrainian grain imports, hoping to protect local farmers following an influx of cheaper supplies since Russia’s invasion of Ukraine 14 months ago.

“But there was some relief for Kyiv as Romania, a key trade partner, stopped short of banning imports even as it tightened controls on the transit of Ukrainian grain.”

The Reuters article noted that, “Kyiv and its allies blamed the latest halt to ship inspections in the Bosphorus this week on Moscow, which in turn blamed Ukraine and the United Nations.”

Polityuk added that, “Kyiv is also trying to secure agreement from Hungary, Poland and Slovakia to lift bans on imports of Ukrainian grain and food products that were announced in the last few days.”

Reuters writer Krisztina Than reported today that, “Hungary will continue to allow transit of Ukrainian grain, ensuring the departure of such shipments ‘in a controlled manner,’ its agriculture minister, Istvan Nagy, told state news agency MTI after talks in Brussels.”

Earlier this week, Poland also agreed to lift a ban on Ukrainian grain transit.

Meanwhile, Reuters writer Philip Blenkinsop reported yesterday that, “The European Union is preparing 100 million euros ($109.32 million) in compensation for farmers in five countries bordering Ukraine and plans to introduce restrictions on imports of Ukrainian grains.

“Pressure has mounted on Brussels to work out a European Union-wide solution after Poland and Hungary banned some imports from Ukraine last weekend and other eastern European countries said they were considering similar action.”

The Reuters article pointed out that, “European Trade Commissioner Valdis Dombrovskis discussed the plans on Wednesday with ministers from Bulgaria, Hungary, Poland, Romania and Slovakia, as well as with Ukrainian counterparts.

“Romanian Farm Minister Petre Daea said Dombrovskis asked Bulgaria, Hungary, Poland and Slovakia to withdraw their individual import bans and that the Commission could approve a general ban of Ukrainian grain and oilseeds to the five countries affected until June 5.”

In a related statement yesterday, Dombrovskis and Commissioner Wojciechowski indicated that, “We presented the EU’s comprehensive proposals to address the concerns expressed by these 5 Member States regarding the deterioration in the situation of Union producers for specific products. This proposed Commission package includes a second tranche of agricultural financial support to affected farmers, exceptional safeguard measures on key products and measures to facilitate the transit of Ukrainian grain exports via the Solidarity Lanes. The Commission’s proposed package is subject to Member States lifting their unilateral measures.

“We underlined the importance of rapidly following a common EU approach, rather than unilateral solutions to avoid multiple bans and solutions which put the internal market at risk.”

Reuters writer Naveen Thukral reported today that, “Chicago wheat futures lost more ground on Thursday as supply concerns eased with inspections of ships carrying Ukrainian grain resuming in the Black Sea region.”

Elsewhere, Jared Malsin and Anna Hirtenstein reported in today’s Wall Street Journal that,

Ukrainian authorities have asked Turkey to seize a ship carrying what prosecutors in Kyiv say is thousands of tons of grain stolen from areas of Ukraine occupied by Russia, according to correspondence reviewed by The Wall Street Journal.

“The ship, the Panama-flagged Bomustafa O, arrived in the Turkish Black Sea port of Samsun on Monday, with a cargo of 19,000 tons of barley, according to shipping records and the correspondence. Days earlier, Ukrainian prosecutors in Kyiv wrote to Turkish authorities asking them to seize the ship, saying that it had loaded barley at a port in Russian-occupied Crimea, according to the correspondence reviewed by the Journal.