Putin says Russia thinking of ditching grain deal due to West's 'cheating'
UN chief concerned Russia may not extend Ukraine grain deal
The U.N. chief expressed concern about Russia not renewing the Black Sea Grain Initiative on July 17.
Moscow has been threatening to walk away from the deal known as the Black Sea Grain Initiative – brokered by the United Nations and Türkiye in July last year – if obstacles to its own grain and fertilizer shipments are not removed.
In May, Russia extended the deal for 60 days. It is due to be renewed in July 17th
According to the UN Black Sea Grain Initiative Joint Coordination Centre, since the agreement was signed, over 27 million tonnes of grain and other foodstuffs have been exported through the Black Sea (as of April 2023).
Generally, the wheat harvest in Ukraine begins in late June and extends through July and sometimes into early August. In general, maize harvest in Ukraine begins in late September or early October and continues through October and sometimes into November.
Ukraine is one of the biggest grain exporters in the world
(source: usda via economicsobservatory)
This market will resolve as "YES" if Russia officially withdraws from the deal, or if grain is anyway blocked from leaving Ukraine by sea, or if I otherwise judge that the deal has fallen apart.
The market will resolve as "NO" if the deal is delayed, but still signed not long after the July 17th deadline.
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@Mirek What negativity? Do you have any sense of just how much of the world's staple food gets grown in Ukraine? Or just how politically precarious like half the Middle East is, and the whole thing where they have to import most of their food? From places like Ukraine?
There's a strong argument that the entire Arab Spring - which began as cost of living riots (hence the dude with a bread hat) - was a response to the spike in the price of food, especially grain around 2008 driven by global drought, ethanol production, and export bans on rice.
Instead, the crisis was triggered by:
-- Growing demand for biofuels, which has driven up prices of corn and soybeans
-- Higher energy prices, which makes biofuels profitable and crops that feed them more sought after. Higher oil prices also boosts farm production costs, such as diesel.
-- Falling value of the U.S. dollar
-- Export bans and panic buying, particularly for rice, of which only about 6 percent of the global crop is exported, making international prices more volatile.
-- Bad weather, particularly triggered by cuts in wheat production in Ukraine, Australia and Argentina.
@Mirek I agree that Lorxus could have been a bit more chill. But this is a political question on a site about forecasting the future. Speculating about this stuff is what we do. If you disagree with the analysis, go make a market about it!
@VitorBosshard also: kinda hard to be chill about the completely avoidable wave of famines in our near future and the further waste and conflict that that will drive.
https://www.nytimes.com/2023/07/18/world/europe/russia-barrage-odesa-grain-bridge.html
Selling my NO position and buying YES. Doesn't look like it will happen by end of July at this rate.
I won't resolve this yet - Russia is not super trustworthy when it comes to foreign affairs, and there is some possibility they are jockeying for better negotiation position.
I'll wait until the end of July, as mentioned in the comments, and unless there is more development, this will resolve as "yes".
MOSCOW, July 17 (Reuters) - Russia said on Monday that it had halted participation in a landmark UN-brokered deal which allowed Ukrainian grain to be exported through the Black Sea just hours after Moscow said Ukraine had attacked the Crimean Bridge.
...
"In fact, the Black Sea agreements ceased to be valid today," Kremlin spokesman Dmitry Peskov told reporters on a conference call. "Unfortunately, the part of these Black Sea agreements concerning Russia has not been implemented so far, so its effect is terminated."
Russia has notified Turkey, Ukraine and the U.N. that Moscow is against extending the deal, Maria Zakharova, a spokeswoman for Russia's foreign ministry, said.
The Chicago Board of Trade's most active wheat contract was up 3.4% at $6.84 a bushel by 0910 GMT after earlier rising over 4%.
https://www.cnn.com/2023/07/16/europe/russia-crimea-bridge-intl-hnk/index.html
This won't help getting the deal done.
"
Peskov also told reporters that the decision to allow the deal to lapse was not related to Ukraine’s claimed strike on the bridge.
“These are absolutely unrelated events,” he said. “Even before this terrorist attack, the position was declared by President Putin. And I repeat again, as soon as the part of the Black Sea agreements concerning Russia is fulfilled, Russia will immediately return to the implementation of the deal.”
"The Turkish president said he and Vladimir Putin are "on the same page" when it comes to extending the Black Sea grain deal. The Kremlin, however, said no announcement had been made."
@nickten Based on the short time left it looks like it will lapse, but based on the "same page" comment I am guessing perhaps it will get signed soon after (days not weeks),
https://www.dw.com/en/erdogan-claims-putin-agreed-to-renew-black-sea-grain-deal/a-66238371
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"KYIV, June 22 (Reuters) - Russia is 99.9% certain to quit a U.N.-brokered deal on the safe wartime passage of Black Sea grain next month because it no longer needs Ukrainian ports to export ammonia, a senior Ukrainian diplomat said."
/cloudfront-us-east-2.images.arcpublishing.com/reuters/6EWQYLLHIJLXDHEKKQK7AZ52KY.jpg)
This is from Friday - “It is impossible to update this deal, and under these conditions, I believe, it is also impossible to extend it because the limit of our patience and desire to implement it has been exhausted,” Interfax news agency cited the speaker of the upper house of parliament, Valentina Matviyenko, as saying.