Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

Russia, Ukraine agree to protect Ukraine grain shipping channel

Commodities Aug 08, 2022 06:05PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
2/2 © Reuters. FILE PHOTO: The Sierra Leone-flagged cargo ship Razoni, carrying Ukrainian grain, is seen in the Black Sea off Kilyos, near Istanbul, Turkey August 3, 2022. REUTERS/Mehmet Emin Caliskan 2/2

By Jonathan Saul and Michelle Nichols

LONDON/NEW YORK (Reuters) -Ships exporting Ukraine grain through the Black Sea will be protected by a 10 nautical mile buffer zone, according to long-awaited procedures agreed by Russia, Ukraine, Turkey and the United Nations on Monday and seen by Reuters.

The United Nations and Turkey brokered a deal last month after Russia's Feb. 24 invasion of Ukraine halted grain exports, stoking a global food crisis that the United Nations says has pushed tens of millions more people into hunger.

Since then Russia, Ukraine, Turkey and the United Nations have been working to hammer out written procedures in the hope that it will assure shipping and insurance companies enough to resume grain and fertilizer shipments from the Ukrainian ports of Odesa, Chornomorsk and Yuzhny.

"We very much hope it will increase the traffic under this initiative," said U.N. Secretary-General Antonio Guterres' spokesman Stephane Dujarric after the procedures were agreed.

The initiative has been operating in a trial phase for the past two weeks. Ten ships - stuck in Ukraine since the war started - have departed with corn, soybeans and sunflower oil and meal. Two empty vessels have traveled to Ukraine to collect shipments.

The biggest ship yet, the Ocean Lion, is due to leave the port of Chornomorsk on Tuesday to deliver 64,720 metric tons of corn to South Korea, said the Joint Coordination Centre (JCC) on Monday. The JCC in Istanbul oversees the deal and is made up of Turkish, Russian, Ukrainian and U.N. officials.

COMMERCIAL OPERATION

Ukraine, along with Russia, is a major global supplier of wheat and other foodstuffs. However, the first ship to depart Ukraine under the U.N. deal last week is now looking for another port to unload after the initial Lebanese buyer refused delivery, citing a more than five-month delay.

The United Nations has stressed that the export deal is a commercial - not humanitarian - operation that will be driven by the market. All ships are required to be inspected to allay Russian concerns they could be smuggling weapons in to Ukraine.

Neil Roberts, head of marine and aviation at Lloyd's Market Association - which represents the interests of all underwriting businesses in the Lloyd's of London insurance market - told Reuters that the industry could now "play its part."

"The successful exit of multiple vessels was beyond the imagining of most people only a few weeks ago and to have come this far is extraordinary," said Roberts. "To actually achieve the goals of the U.N.'s initiative would be something for historians to reflect on."

PROTECTION ZONE

The shipping and insurance industry wanted assurances of a secure journey with no threat of sea mines or attacks to their ships and crews. These are typically covered in standard operating procedures, which is what was agreed on Monday.

"The parties will not undertake any attacks against merchant vessels or other civilian vessels and port facilities engaged in this initiative," according to the 'procedures for merchant vessels' document.

One insurance industry source said the procedures "read as a reassuring set of rules. But will all sides stick to it?".

Under the agreed procedures, the JCC will provide information on the planned movement of ships through the maritime humanitarian corridor, which will be shared with Russia, Ukraine and Turkey's military to prevent incidents.

Then as the vessel moves through the maritime humanitarian corridor it will be protected by a 10 nautical mile circle buffer zone around it.

"No military vessel, aircraft or UAVs (drones) will close to within 10 nautical miles of a merchant vessel transiting the Maritime Humanitarian Corridor, excluding territorial seas of Ukraine," according to the document.

Ukraine's President Volodymyr Zelenskiy said there was "every chance" the pace of exports could be maintained.

"The key is how in the days to come our partners will prove able to prevent any attempts by Russia to disrupt exports and again further provoke a world food crisis," Zelenskiy said in a video address on Monday.

Russia has blamed Ukraine for stalling shipments by mining its port waters and rejects accusations Moscow is responsible for fueling the food crisis.

Russia, Ukraine agree to protect Ukraine grain shipping channel
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email