On Saturday, the UN said that the deal had been extended, but it did not clarify for how long.
“The Black Sea Grain Initiative, alongside the Memorandum of Understanding on promoting Russian food products and fertilizers to the world markets, are critical for global food security, especially for the most vulnerable countries,” stated the office of the spokesperson for the UN Secretary-General.
Russia indicated that it would be a 60-day extension, and it warned that any further extension of the initiative would depend on the removal of some Western sanctions.
But Ukraine and Turkey said another 120 days has been added to the agreement.
“This deal is of vital importance for the global food supply. I thank Russia and Ukraine, who didn’t spare their efforts for a new extension, as well as the United Nations secretary general," Turkish president, Recep Tayyip Erdoga, said in televised comments.
The original deal between the two sides, brokered in July by Turkey and the UN, was renewed in November last year and it has seen more than 11 million tons of agricultural products shipped from three of Ukraine’s Black Sea ports, including 4.5m tons of corn and 3.2m tons of wheat.
Grain market developments
Grain prices declined to start the week on relief at the renewal of the Black Sea grain export deal, even if on disputed terms, with a further slide in oil markets weighing too, reported the CRM Agri team.
“Brent crude touched $70.12 a barrel at one point, its lowest since December 2021, amid continued bank sector worries, although some other risk markets, such as shares, posted gains on reduced interest rate outlook profiles, which helped the dollar ease 0.3% too.
“Rapeseed suffered fallout from the oil market decline, with the Paris May-23 contract shedding 3.4% to its lowest since August 2021. The dip matched a decline in Kuala Lumpur palm oil for June-23 too.”
For wheat, however, a dip of 1.8% in Chicago May-23 futures back below $7.00/Bu and falls of 1.2% in UK feed wheat and 2.4% in Paris milling wheat to their lowest in more than a year were viewed as reflecting the extension of the Black Sea grain export corridor, said the UK analysts.
The EU’s Mars bureau offered reassurance for this year’s EU soft wheat yield, pegging it at 5.99t/ha, 3% above the year-ago and five-year-average levels.
“Chicago corn futures for May-23 shed a more modest 0.4%, retaining some support from China’s recent buying spree of US supplies, although no further purchases were announced on Monday.”