Putin considers exiting grain deal over West’s ‘cheating’

Moscow — President Vladimir Putin said on Tuesday that Russia was considering withdrawing from the Black Sea grain deal because the West had cheated Moscow by failing to implementing promises to get Russian agricultural goods to world markets.

The deal allowing Ukraine to resume seaborne grain exports was brokered by the UN and Turkey in July 2022 to help tackle a global food crisis the UN said had been worsened by Europe’s deadliest conflict since World War 2.

To convince Moscow to approve the pact, known by diplomats as the Black Sea Grain Initiative, a three-year accord was struck at the same time under which UN officials agreed to help Russia with its own food and fertiliser exports.

But Putin said that had not been implemented due to the perfidy of the West. “We are thinking about getting out of this grain deal now,” Putin told a meeting of Russian war correspondents and military bloggers.

“Unfortunately, we were once again cheated — nothing was done in terms of liberalising the supply of our grain to foreign markets. There were a lot of conditions that the westerners had to fulfil under the leadership of the UN

“Nothing has been done,” Putin said.

Western powers have imposed what they cast as the toughest sanctions ever on Russia over its war in Ukraine launched on February 24 2022.

While Russia’s food and fertiliser exports are not sanctioned, the West’s restrictions on payments, logistics and insurance pose barriers to shipments, according to Moscow and major Russian grain and fertiliser exporters.

Russia and Ukraine are two of the world’s top agricultural producers, and major players in the wheat, barley, maize, rapeseed, rapeseed oil, sunflower seed and sunflower oil markets. Russia is also dominant in the fertiliser market.

UN secretary-general Antonio Guterres said on Monday he was concerned Russia would quit the grain deal on July 17.

“We are working hard in order to make sure that it will be possible to maintain the Black Sea initiative and at the same time that we are able to go on in our work to facilitate Russian exports,” Guterres said.

Putin made it absolutely clear that Russia is considering stopping participation in the grain deal.

He said he would discuss its future with some African leaders expected to visit Russia soon, adding that Moscow was ready to supply grain for free to the world’s poorest countries.

“Almost nothing goes to African countries,” Putin said of the current situation, adding that Moscow had agreed several times to extend the deal but had nothing to show for doing so.

The current deal will expire on July 17 unless Russia agrees to extend.

Russia’s specific demands are that Russian Agricultural Bank (Rosselkhozbank) be reconnected to the Swift payment system, that supplies of agricultural machinery and parts to Russia needed to be resumed, and that restrictions on insurance and reinsurance needed to be lifted.

Other demands include the resumption of the Togliatti-Odesa ammonia pipeline that lets Russia pump the chemical to Ukraine’s main Black Sea port, and the unblocking of assets and accounts of Russian companies involved in food and fertiliser exports.

Reuters