Russia insists on its message to the West: our conditions are not being met, perhaps this time the Black Sea corridor, through which more than 32 million tons of Ukrainian grain have left and which expires on July 17, will not be renewed. Specifically, Kremlin spokesman Dmitri Peskov has assured that “there is still time, but there is not much hope” that they will see their used ones filled. Sergei Lavrov, make clear the spirit with which the Russian side is facing the imminent negotiations. Spain has a lot at stake in this stake, since it is the second country that has benefited the most from this pact, only behind China.
The Russian side has been reiterating that the conditions for accessing the export of Ukrainian grain include the reconnection of the Russian agricultural bank, Rosselkhoznadzor, to the Swift international payment system and giving free rein to the supply of spare parts for agricultural machinery to Russia; as well as the export of goods such as ammonia, essential in the manufacture of fertilizers, through Ukraine, and the unblocking of transport and insurance logistics.
In return, Peskov did not want to comment on the publication of ‘The Financial Times’ about the European Union considering the proposal of the Russian agricultural bank Rosseljozbank to create a subsidiary to reconnect through it to SWIFT, the global financial communication system. “No, for now we have nothing to report on compliance with the part of the agreements that refers to the Russian side,” he stressed.
Spain, the second best client of Ukrainian grain
Why does Spain play a lot in the renewal of the grain pact? As this medium has been reporting, Spain continues to be the second best client of the broker, from which it has imported almost 6 million tons of cereal from Ukraine since August 2022, according to data from the Ukrainian Grain Union. An eventual closure would take two weeks thus before the grain from other markets such as Brazil or Argentina was ready. As of August, according to sources consulted in the sector, the “peak” of the cereal that is imported from these two countries arrives and will arrive at the port of Tarragona. Later, in the first quarter of 2024, if the corridor does not close, the grain Ukrainian will have to take over to feed a structurally deficit country like Spain.
To all of the above is added that this campaign will end with one of the most mermaid cereal production in recent years due to the drought. Specifically, it is estimated that it will remain at around 9 million tons. A figure in which sources as diverse as Agro-Food Cooperatives and grain organizations such as the Spanish Grain and Oilseed Trade Association (ACCOE) agree.
Spain is a structurally deficient country in cereals, since it has to feed a relevant cattle herd, which happens to be one of the most exporting industries. Specifically, according to the ‘Balance of Cereals in Spain’ for the 2022/2023 campaign prepared by the Ministry of Agriculture, it points to total needs of 35.85 million tons of cereals. Of this amount, some 26.35 million will be for animal feed. For what will be missing, at least, the importation of 18 million tons of cereals.
Criticism of Lavrov, raise the pressure
The Russian Minister of Foreign Affairs, Sergei Lavrov, insisted last Friday that the commitments promised to his country are not met. Lavrov assured in a press conference that “I do not see what arguments those who want to extend the validity of this Black Sea initiative have, because when it comes to Ukrainian grain it has long since become a commercial initiative.”
The Russian representative once again used the humanitarian argument, giving some data such as that of two ships for the UN World Food Program, aimed at countries in need, some 90 ships with Ukrainian grain had set sail with clearly commercial fines. In addition, the head of Russian diplomacy has assured that of the 32.5 million tons of grain exported from Ukraine since August 1, 2022, only 2.5% have gone to countries in need, while 40% have gone to the European Union, 24% to China and 10% to Turkey.
