Shortly thereafter, Russia made a U-turn and announced it would return to the agreement after negotiations with Turkey. Moscow cited written guarantees from Ukraine that Kyiv would not use this corridor for military purposes or attacks against Russia.
This brief spat over the deal, which to that point had worked for all parties, left a mixed impression. On the one hand, Russia’s actions underscored that the agreement was vulnerable and weak, and made clear Moscow’s readiness to abandon it at any moment it saw fit. On the other hand, Turkey’s intervention, which secured the continuation of the deal and convinced the Kremlin to rejoin it, illustrated the significant influence Ankara wields in the Black Sea, both as a key interlocutor between parties and as a counteracting player to Russia.
Russia’s move was inevitable. From the very beginning Moscow has seen the grain deal as affording it leverage over Ukraine and the West. Grain exports are one of the few sources of hard-currency income for the Ukrainian economy. What is more, being a security guarantor of the agreement allows Russia to raise the stakes with minimal effort every time it wants to pressure the West by destabilizing world food prices, which in turn has an impact on inflation worldwide. Indeed, Russia’s brief suspension of its participation in the grain deal caused a spike in wheat prices across the globe.
The most obvious goal of the deal was to ensure food security. Russia’s invasion of Ukraine caused a surge in global food prices, dealing a heavy blow to countries already at risk of food insecurity. Ukraine has been one of the world’s largest exporters of grain, contributing 42% of the global share of sunflower oil, 16% of maize, and almost 10% of wheat. Not only are Ukraine’s exports essential for the stability of world markets, but Ukraine’s grain exports have also contributed greatly to the World Food Program’s humanitarian stocks, shipped regularly to such war-ridden countries as Yemen, Ethiopia, Somalia, and South Sudan.
The July agreement between Russia and Ukraine allowing grain and fertilizers to return to the market probably averted a humanitarian catastrophe and economic meltdown. Since the signing of the deal, around 9.5 million tons of grain products have left Ukraine by sea. More than 100 ships have sailed from Ukraine, with 47% of the grain cargoes going to Turkey and Asian countries, 36% going to the EU, and 17% to Africa. Immediately after the agreement went into effect, food prices fell by 7.90 percent since March 2022. After hitting an all-time high immediately after Russia’s invasion in February 2022, world wheat prices dropped by 14.5% and cereal prices dropped by 11.5%. Prices for those grains are still higher than they were in 2021, but the deal certainly eased pressure on the market. In terms of stabilizing markets, the deal has proved to be effective.
However, the agreement was not designed to save conflict-affected communities around the world, which for the most part continue to suffer critical food shortages. Particularly, Russia has constantly criticized the agreement, alleging that the grain is not reaching countries that need it the most.
Indeed, contrary to popular perception, the majority of grain exports that were shipped out of Ukrainian Black Sea ports didn`t go to the poorest and most needed countries but rather to Europe and Turkey. Over the past five months, more than 12.3 tons of grain was shipped from Ukraine, with 44% of it being corn rather than wheat. The main destinations of the cargoes were Spain, China, Turkey, Italy, and the Netherlands.
Most of the grain that had been held up in Ukrainian silos after February 24 was corn, contracted by international companies, not necessarily to feed people but, for example, to use as biofuel or animal food. Therefore, the agreement wasn’t designed to immediately avert famine in countries like Yemen or Somalia but rather to stabilize the market and contain prices, which in turn hurt countries’ ability to purchase food.
From the Ukrainian perspective the agreement has positive implications. It allowed Ukraine to return to almost prewar amounts of exports, increasing its share from 1–1.5 million tons to almost 4 million tons.
In addition, the deal freed up some space for Ukraine to store the next harvest, which is expected to amount to 53 million tons, far exceeding domestic needs. The deal allows Ukrainian farmers to start planting crops for next year.
The deal also ensures that Ukraine’s farming sector is not totally destroyed. Because of the war, Ukraine’s farming industry has lost 50% of its 2021 gross output, which has led to serious liquidity problems for farmers. The grain had to be moved out of storage silos to avert a storage crisis, and if the whole goal of the deal was to move grain out of Ukraine, then the treaty made it possible.
Any hope that the grain deal might serve as a basis for the slow build-up of a potential compromise between Russia and Ukraine/the West has been dashed.
Ukraine and Russia don’t trust each other and are not ready to negotiate. Russia’s attempt to abandon the deal demonstrated that Moscow doesn’t see it as a trust-building measure but rather is trying to instrumentalize it as part of its war effort. Nor does Ukraine see the agreement as part of a potential peace process. President Zelensky insists that Russia should leave all Ukrainian territory occupied since 2014, including Crimea, no matter whether there is a grain agreement in place or not.
If the agreement is thought of as a means of stabilizing the Black Sea situation and localizing the war in Ukraine, then one could argue it has partially succeeded. Although Russia didn’t stop its indiscriminate attacks against energy, military, and civilian infrastructure in Ukraine’s South, it did show restraint toward foreign ships, which started shipping grain out of Ukraine through the Turkey-supervised safe corridor. In some way, the agreement has contributed to the creation of certain rules.
Finally, if the agreement was about strengthening Turkey’s geopolitical leadership in the region, then it has definitely succeeded. Ankara boosted its diplomatic image by presenting the agreement as an achievement aiding food-dependent African and Asian countries. Moreover, Turkey cemented its role as a key mediator in the Russia-Ukraine war, capable of talking to both sides. President Erdoğan in particular has been able to capitalize on the deal by placing Turkey at the heart of any potential follow-up agreements between Kyiv and Moscow.
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