Despite the Black Sea Grain Initiative helped to bring down the cost of food, stabilize global markets and keep them open, the progress remains fragile and price pressures remain. While food prices have gone down from their all-time high at the start of the war, they remain high compared to pre-crises levels, the report – the Impact of the Black Sea Grain Initiative said.
Further, the UNCTAD report said currency depreciations prevent many developing countries from benefiting from global price decreases, and, in the most severe cases, prices have even gone up. Additionally, as is so often the case, the most vulnerable bear the brunt, particularly women.
IMPORTANT FINDINGS
- Developing countries have benefitted the most from the Initiative, supporting food security among the most vulnerable.
- Wheat and corn are among the world’s most used food staples. Under the Initiative, corn and wheat accounted for 77 per cent of exports.
- Exports of corn to developed and developing countries have been almost evenly split, at 51 per cent and 49 per cent, respectively. Exports of wheat have gone predominantly to developing countries and least developed countries, representing 65 per cent of total wheat cargo.
- Black Sea Grain Initiative helped mitigate price shocks in the international market and facilitated a steady food supply.
- Since the signing of the Initiative, ship departures from Ukrainian ports have shown a marked increase. However, despite the Initiative’s efforts, there is still more to be done to restore ship departures from Ukraine to 2021 levels. Before the war, more than 90 per cent of ships had departed from seaports. However, with the war, this share abruptly dropped to 20 per cent. After the signing of the Initiative, the share almost doubled.
- Trade along rivers has become more important compared to the pre-war period. Trade diversion towards river ports – in particular the river Danube – is also reflected in trade statistics. But trade via inland waterways comes at a higher cost. River routes cannot handle large dry bulk vessels but instead employ small cargo and multipurpose vessels carrying lower volumes.
- The Food and Agriculture Organization (FAO) reports that food prices are almost 18 per cent lower than their all-time high in March 2022, following the start of the war in Ukraine.
- Women face a higher risk of food insecurity
BLACK GRAIN INITIATIVE
The sailing of the Maize cargo container is the first under a United Nationsbacked agreement enabling resumption of Ukrainian farm produce exports through its Black Sea ports. This agreement known as Black Sea Grain Initiative is an agreement between Russia and Ukraine with Turkey and the United Nations signed in Istanbul on July 22, 2022. The initiative allows for significant volumes of commercial food exports from three key Ukrainian ports in the Black Sea – Odesa, Chornomorsk, Yuzhny. As part of the deal, a Joint Coordination Centre formed will monitor the implementation.
