Why Russia’s grain deal snub isn’t just about attack on Kerch Bridge

At a glance, the Kremlin’s announcement Monday of the decision to formally pull Russia out of the deal to keep Ukrainian grain and oilseeds flowing to a hungry world might look like a direct response to the Ukrainian water-borne drone attack that damaged the Kerch Strait Bridge, Crimea’s key link to the Russian mainland.

But this likely was a decision that had been a long time coming.

The Black Sea Grain Initiative brokered by Turkey and the United Nations, despite Russia’s naval blockade of Ukraine’s Black Sea ports, was one of the few positive international agreements that helped to ameliorate the impact of the nearly 17-month-old war on the global economy, particularly the price of basic foodstuffs.

But while Russia’s adherence to the complex deal enabled Ukraine to export millions of tons of grain to the world market, Russia argues, promised measures that would have facilitated Russian food and fertilizer exports were never implemented by the West.

Moreover, a worsening geopolitical environment may have contributed to Moscow’s decision to terminate the arrangement. The Ukrainian attack on the Kerch Bridge likely increased Russian determination to assert greater naval control over the Black Sea region.

In addition, Turkish President Recep Tayyip Erdoğan, a central mediator of the grain deal, infuriated Russia by handing over several interned Ukrainian prisoners of war – members of the notorious Azov regiment – during a visit to Turkey this month by Ukrainian President Volodymyr Zelenskyy. As a result, experts say, Mr. Erdoğan’s appeals for further talks about the grain deal may now fall on deaf ears in Moscow.

“Russia didn’t need this deal at all,” says Arkady Zlochevsky, president of Russian Grain Union, an industry group. “The deal has never given us anything but damage. ... This deal was terminated by Russia because obligations made to Russia were not fulfilled. There were agreements to facilitate Russian food and fertilizer exports, the importation of spare parts for our agricultural machinery, reconnecting [the Russian Agricultural Bank, which is under the oversight of government body] Rosselkhoznadzor to the SWIFT bank transfer system [to enable payments for Russian exports].

“A one-sided deal is not profitable for us.”

“Impossible to continue”

The accord was negotiated a year ago to enable Ukraine to open safe sea lanes to its heavily mined and blockaded Black Sea ports in order to export its stored grain and oilseeds to traditional markets amid shortages and spiraling prices. Mr. Erdoğan and the U.N. negotiated separately with Russia and Ukraine and arranged joint measures to monitor and inspect shipping. Over the past year, Ukraine has exported around 33 million metric tons of foodstuffs, while global food prices have largely stabilized. Prices jumped again following the Russian announcement.

The Russian Foreign Ministry warned on Telegram that, as of Tuesday, the “humanitarian corridor” created in the Black Sea to enable grain shipments and the corridor’s monitoring system will now be closed, leading to a “temporarily dangerous” situation in the shipping lanes. In practice, that may mean fully imposing a Russian naval blockade on Ukraine’s ports.

“Maybe now Russia will move to shut down all transport to Ukraine’s Black Sea ports, which includes much more than grain,” says Alexei Mukhin, director of the independent Center for Political Information in Moscow. “Nothing that Russia wanted from the deal has materialized, and for the Kremlin, it’s just become impossible to continue it.”

Western response to the Russian move has been harsh, with U.S. Secretary of State Antony Blinken accusing Moscow of “weaponizing food.” President Zelenskyy appealed for international measures to keep the flow of grain moving through the Black Sea without Russia’s participation. In his regular daily address, Mr. Zelenskyy asked U.N. Secretary-General António Guterres to work with “responsible states to restore food security and food supply via the Black Sea routes.”

It’s not clear who would enforce open shipping lanes in the Black Sea if the Russian navy decided to shut them down. White House National Security Council spokesperson John Kirby said that the U.S. military would not be used to protect Ukrainian grain shipments.

Feeding a global market

The propagandist war of words has mainly focused on the impact on vulnerable populations in the Global South. Russian President Vladimir Putin recently alleged that only 3% of Ukrainian grain exports were being sent to developing nations, with the bulk going to rich countries. Actually, the biggest single customer for Ukrainian grain delivered under the deal has been China, followed by Spain, Turkey, and Italy.

But the importance to the international market of making Ukrainian grain available is less about who buys it – since grain is fungible – than that it increases the overall available supply and thus reduces overall demand. According to the U.N., global prices fell by almost 25% after the deal was implemented, making grain more accessible to poorer consumers.

Russia insists that it’s been ready to step up its own exports of grain and provide them at a discount to countries facing hunger. But it has been hampered by difficulties regarding insurance for ships transporting its goods, the Russian Agricultural Bank's exclusion from the SWIFT financial system, and other sanctions-related problems. Despite promises to lift impediments to Russian food exports, nothing has been done, the Russians say.

Neither, they add, have agreements to enable the export of Russian ammonia, a vital ingredient in fertilizers, been fulfilled. And in June, a pipeline carrying ammonia from Russia to the Ukrainian seaport of Odesa was destroyed, allegedly by Ukrainian saboteurs, leaving Moscow claiming it had even fewer remaining reasons to renew the Black Sea deal.

A fresh extension of the arrangement could be possible only if Mr. Putin decides it’s politically desirable.

“We might see a new round of talks between Erdoğan and Putin, and they might come up with some new scheme,” says Fyodor Lukyanov, editor of Russia in Global Affairs, a Moscow-based foreign policy journal. “Since we [Russians] live in a system of full-scale personal autocracy, where everything depends on the will of one person, anything is possible. But it doesn’t seem likely.”

No fresh talks between the Russian and Turkish leaders are currently on the agenda, Russian news agency TASS reports.

When the grain deal was brokered a year ago, many hoped it would lead to further diplomatic breakthroughs and perhaps even a path to peace. Nothing of that sort has happened, while both Ukraine and Russia have looked for other ways to export their agricultural produce. The end of the grain deal seems unlikely to make much difference, says Mr. Lukyanov.

“Real diplomacy will begin only when both sides realize there is nothing more to be gained on the battlefield,” he says. “We’re not there yet.”