Russian President's Press Secretary Dmitry Peskov said on Monday that the Black Sea grain transport agreement has been terminated because the part related to Russia has not been implemented.
Earlier, Russian Foreign Ministry Spokeswoman Maria Zakharova said that Russia had officially notified Turkey, Ukraine, and the UN Secretary-General that it opposed extending the Black Sea port agricultural product export agreement.
After Russia announced that it would stop implementing the Black Sea port agricultural product export agreement, the main contract of wheat futures traded on the Chicago Mercantile Exchange (CBOT) rose during the day, with prices once breaking through 6.89 US dollars, an intraday increase of more than 4%.
However, the upward trend quickly disappeared. Since the US stock market opened, the price of wheat futures has accelerated its decline and turned to fall. In the early trading of the US stock market, it once fell below 6.60 US dollars, refreshing the intraday low, and fell by more than 1%.
Analysts said that the market was well aware of the risk that the agricultural product agreement would not be extended after it expired, and still expected the agreement to be restarted. The market has heard Russia express its intention to withdraw from the agreement many times, and the market suspects that the agreement may only be suspended, not actually terminated, and may still have hope of restarting.
In his statement on Monday, Peskov hinted that the agreement could be restarted if Russia's conditions were met. According to Xinhua News Agency, Tass quoted Peskov as saying that Russia would immediately resume the agreement once the relevant part of the agreement was implemented.
After the escalation of the Ukrainian crisis last year, the export of agricultural products from Russia and Ukraine through the Black Sea ports was blocked. With the mediation of the United Nations and Turkey, Russia and Ukraine signed the Black Sea port agricultural product export agreement with the United Nations and Turkey on July 22, 2021, with a validity period of 120 days. The agreement has been extended several times since then, and is due to expire on July 17.
Since the implementation of the Black Sea port agricultural product export agreement, Russia has always emphasized that the contents of the memorandum have not been fulfilled. Recently, Russia has warned that it does not have a good outlook for the prospect of the agreement being extended.
Russian Foreign Minister Sergei Lavrov said at the end of last month that the West's attitude towards this agreement was "enraging", and that the West had imposed various obstacles on Russia's grain and fertilizer exports. However, Russia has bypassed these obstacles and continued to provide grain to the least developed countries. If the agreement is terminated, Russia will continue to provide free grain to the poorest countries, with quantities similar to or even greater than the current amount.
In early July, Peskov said that the chances of the agreement being extended were not great. After that, the Russian Foreign Ministry issued a statement saying that there was currently no reason to further extend the Black Sea port agricultural product export agreement that was about to expire. The agreement was intended to provide food aid to countries in need in Asia, Africa, and Latin America, but it has become a commercial grain export for Ukraine to countries with sufficient grain.
The statement pointed out that the implementation of the memorandum signed by Russia and the United Nations on the supply of grain and fertilizers to the world market is still deteriorating. In addition to the continued expansion of sanctions by the United States and the United Kingdom to restrict Russian agricultural exports, the European Union has also introduced a series of sanctions.
There have been some speculations that the recent attack on the Crimea Bridge, a key supply route for Russia's military operations in Ukraine, was the last straw that broke the prospect of the agreement being extended. However, the Russian government has downplayed the connection.
Some media reported that Ukrainian officials said on Monday that the Ukrainian military and security services were responsible for the attack on the bridge, and that the Ukrainian side used drones to attack the bridge. The Russian side has condemned the attack on the bridge as a terrorist attack. However, Peskov pointed out that Russia had expressed its intention not to extend the grain agreement before the bridge was attacked.
Earlier on Monday, Chinese Foreign Ministry Spokesperson Wang Wenbin said when commenting on the Black Sea grain agreement that China hopes that the Black Sea grain transport package agreement will continue to be implemented in a balanced, comprehensive, and effective manner. China has proposed an international food security cooperation initiative, and is willing to strengthen communication and cooperation with all parties in this regard, promote the formation of more international consensus, and make positive contributions to ensuring global food security.
