“Russia has weaponized food during this conflict. They’ve destroyed agricultural facilities; they’ve prevented millions of tons of Ukrainian grain from getting to those who need it,” says State Department spokesman Ned Price recently speaking about Russia’s wanton disregard for lives and livelihoods not only in that region but well beyond. Russian President Vladimir Putin is at it again after backing out of the July Black Sea grain deal that freed up Ukrainian grain exports over the weekend.
Market analyst John Zanker with Risk Management Commodities says this couldn’t come at a worse time for Ukraine as their corn harvest season aligns with ours here in the U.S.
“It’s time to be shipping corn out and making room for the harvest. A lot of those facilities were already damaged. I think there’s a lot of corn being stored in bags this year, the bags you see every once in a while here. It’s just a mess. This just adds to it.”
Russia blames an alleged Ukrainian drone attack on its Black Sea warships for pulling out of the grain export deal. Ukraine denies the attack, but the November 19th expiration of the grain deal without renewal could reignite hunger and food inflation fears globally.
Russia now says it can no longer guarantee the safety of civilian dry cargo ships participating in the Black Sea initiative and is suspending its implementation for an indefinite period.
“It’ll be interesting to see how Ukraine presses this, whether they’ll continue to ship. The problem with that is Russia can shut that down quick with some well-placed missile strikes on the three ports that are exporting. And, if you’re an insurer of these ships, which are not usually Ukrainian flagged, it’s pretty hard to put your equipment, your cargo, and your crew in danger.”
Bloomberg reported late Tuesday afternoon that grain vessels would be halted after Russia warned that they weren’t safe using the route, moving grain futures higher toward the end of the trading session. The United Nations said the vessels are expected to move through again on Thursday.
President Biden called the blockade resumption an “outrageous act,” and The European Union’s foreign policy chief says Russia’s decision puts the much-needed exports of grain and fertilizers to address the global food crisis at risk.
Source: NAFB News Service