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The Ukrainian Grain Crisis

Updated: May 23

As President Zelensky took the stage at the United Nations, accusing Russia of weaponising food prices and arguing that neighbouring allies were making a "political thriller" out of the European grain exports issue, the festering grain crisis in Europe and uncertainty over the Black Sea Grain Initiative came into full view.

Regarding the situation in Europe, these sharp remarks appear to have taken their toll. Poland, one of Ukraine's staunchest allies, announced it will no longer send new weapons to Ukraine, instead focusing on modernising its military. The two neighbouring countries have been unable to resolve the grain dispute, leading Poland, Hungary and Slovakia to impose their bans on Ukrainian grain after the EU's temporary ban expired.

To understand this crisis and how it unfolded, it is essential to know how significant Ukraine's grain export is for the global food market, how the invasion affected it and why even Ukraine's firmest allies cannot allow the sale of Ukrainian grain in their countries.

Even in the first year of the war (the 2022-23 season), Ukraine produced 48 million tonnes in grain exports, according to Bloomberg, roughly matching its exports in 2021-22. It has remained the sixth-largest wheat shipper in the world and the third-largest for corn. Ukraine's grain exports are a big deal.

Since the Russian invasion began in February 2022, the Russian navy blockaded Ukraine's ports on the Black Sea, trapping 20 million tonnes of grain meant for export, leading to soaring food prices and sparking fears of food shortages in Middle Eastern and African countries.

In July 2022, the UN and Turkey brokered the "Black Sea Grain Initiative", whereby Ukrainian grain exports could pass through a corridor in the Black Sea from the ports of Odesa, Chornomorsk and Yuzhny/Pivdennyi. According to the UN, the 33 million tonnes of exports made possible by this deal have led to a 20% decline in global food prices.

The UN reports that around 57% of foodstuff exports from Ukraine have gone to developing countries, with the other 43% heading to developed countries, mainly China. Also, it is reported that approximately 700,000 tonnes of grain was supplied to the World Food Programme, providing substantive humanitarian aid to countries such as Afghanistan, Yemen, Sudan and Ethiopia.

However, Russia's determination to pull out of the deal in July 2023 put pressure on food prices once again and proved the callousness of the Kremlin. Putin seeks to weaponise food insecurity, as he did with European energy at the start of the war.

This leads us to the disputes in Europe, and I will, again, use the situation from my home country of Poland.

Once the Russians blockaded the ports at the beginning of the war, Ukraine looked for a rapid way of selling the grain for foreign capital. The European Union market was ideal for Ukraine.

However, given that the EU reports producing 31 million tonnes of wheat exports, Ukraine's production is equivalent to that of the whole Union itself. Thus, when millions of tonnes of cheap Ukrainian grain entered the European Union, it undercut the native farmers of European countries. In particular, Poland, Hungary, Slovakia, Romania and Bulgaria were most affected.

In early 2023, the European Union placed an import ban on these countries whilst permitting for transit of goods through to other destinations, particularly to ports on the Baltic or on the Mediterranean. They act as ad hoc trading routes to serve as a safety net if Russia pulls out of the Black Sea Initiative and attempts to block food exports.

However, as of mid-September, the European Union's ban has expired, and yet the problem persists.

In April, Polish farmers protesting in Warsaw were trying to disrupt a visit by President Zelenskyy to demonstrate how Ukrainian imports threaten to knock them out, with tonnes of Polish grain rotting in storage.

It is also worth mentioning that the entry of Ukrainian grain is tariff-free and does not abide by EU standards. It cannot be ignored that the European Union has failed to protect the farmers of member states and has placed zero controls on Ukrainian grain.

Therefore, it is an urgent necessity to create a plan to allow Ukrainian grain to be useful and generate foreign capital without overflowing the EU's agricultural sector. It is worth considering opening up Europe's vast transportation network to ensure rapid delivery of grain due for exports to ports on the Baltic and primarily the Mediterranean.

Instead of taking responsibility for its failure to create a resolution, the European Union seeks to scold, once again, Central and Eastern European countries, which it has abandoned without consideration.

There is also severe disillusionment following President Zelensky's comments about its neighbours and staunchest allies that they were making a "political thriller" from the grain issue. Further, Ukraine's Foreign Minister, Dymitri Kuleba, brandished the bans as "unacceptable" and a way of playing into "Putin's game".

I am afraid to say that the side making a political thriller out of a straightforward issue is denouncing its closest allies at the United Nations and arguing that they are playing into Putin's pocket in front of more or less the entire world.

Countries such as Poland have taken in millions of Ukrainian refugees, allowed them to settle and provided financial support. Furthermore, they have given unprecedented resources and support to their neighbour, thus placing enormous pressure on themselves.

This is unacceptable, as is the European Union's failure to step up and provide a resolution. The fact that this dispute has been deliberately blown out of proportion is what plays directly into Putin's hands.

Like most Europeans, I hope that this dispute is resolved soon so that we can once again stand shoulder-to-shoulder against the barbarism of Vladimir Putin and his war machine.

Image: Vian

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