African nations will bear the brunt of Black Sea grain deal’s collapse

  • 8/4/2023
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After Russia attacked Odesa port last month, Ukraine’s capacity to export grain became highly restricted. Efforts are being made to offer alternative arrangements for transport to help Kyiv with its exports. Meanwhile, Russia is preparing its own pathway. Overall, Moscow’s use of food as a tool against Ukraine continues to have far-reaching implications and is affecting its relations with African countries. Russia’s withdrawal from the Black Sea Grain Initiative, which provided a safe channel for the export of Ukrainian agricultural products through the Black Sea, is creating a dangerous situation. Ukraine is now trying to establish safe shipping via other maritime routes. Other export routes, involving the Danube River and via land to the EU, have been expanding rapidly since the start of the war. In turn, Moscow is improving its capacity to ship its own grain through the Russian river system, looking at the shipping exit strategy via Iran and the International North-South Transport Corridor. Iran plays a key role, combined with its steady supply of Shahed drones to Russia. There are key security issues regarding whether the Danube is safe. Russia threatened all vessels in the Black Sea going to Ukrainian terminals, so that could potentially include ships going to the river. Some shipowners are cautious and currently prefer not to send their ships to the area. Russia’s recent drone attacks on Danube terminals will further impact Ukraine’s ability to export — a topic that needs to be addressed immediately by the appropriate stakeholders. Moscow continues to strike not only Reni port, but also several other facilities, including fuel tanks and administrative buildings. Russia’s continuing attacks — using Iranian drones — on the Danube’s infrastructure hurt Ukraine’s export capability. The Russian drone strikes are also dangerously close to NATO territory, which is increasingly forcing the alliance, or at least Romania, to help defend this port. Bringing in a NATO country feeds into Russia’s arguments about Europe’s designs for the Black Sea. Russia’s withdrawal from the Black Sea Grain Initiative is creating a dangerous situation. Dr. Theodore Karasik The situation is now quite combustible, with a key alternative export route under attack. Russia’s drone attacks are part of a larger package of actions by Moscow to counter the Ukrainian counteroffensive that is ongoing north of the Crimean Peninsula. Consequently, the increasingly afflicted and militarized Black Sea may even be divided in the future, as both Ukraine and Russia try to ship grain and other products to their respective partners. The late summer in the Crimea may see a significant escalation in this maritime theater. Escalation means more barriers to grain transit, in which a principal point of impact is East Africa. East African countries, which source 80 percent of their wheat needs from Russia and Ukraine, will face significant disruption to their supply chains if Russia does not return to the Black Sea Grain Initiative. In the wake of last month’s Russia-Africa conference in St. Petersburg, grain was promised to key states of the Sahel including Eritrea, which has a growing relationship with Moscow that may involve Russian access to the Red Sea port of Assab. The role of Turkish President Recep Tayyip Erdogan will be critical in getting any grain through the Bosphorus. A potential path to de-escalation also runs through Ankara, as Erdogan maintains leverage over Moscow. There are questions about how far Erdogan will go in terms of closing the Turkish Straits or engaging in any type of naval activity against Russia. Finally, the success of the Ukrainian offensive as it aims to reach the Sea of Azov, and Russia’s response, will be crucial to any potential battlefield outcome that may impact the logistics chains. The situation is now quite combustible, with a key alternative export route under attack. Dr. Theodore Karasik Complicating the food issue and its logistics is the big player on the grain market, China. Beijing is maintaining its food stockpiles at historically high levels and is planning to continue building up a food security capacity. Chinese wheat stockpiles can reportedly meet demand for a year and a half. According to data from the US Department of Agriculture, China was expected to have 69 percent of the globe’s maize reserves, 60 percent of its rice and 51 percent of its wheat over the past calendar year. The numbers for 2023 will be higher because of China buying Russian agricultural products. COFCO Group, a major Chinese state-owned food processor, runs one of China’s largest food stockpiling bases at the port of Dalian, in the northeastern part of the country. It stores beans and grains gathered from home and abroad in 310 huge silos. From there, the foodstuffs make their way throughout China via rail and sea as part of the country’s “strategic foods supply.” In this sense, great power rivalry over grains will be a feature of the geopolitical and economic landscape for years to come. The issue is a near- to medium-term problem that could cause great instability in major urban centers. There is no doubt that any disruption to the grain agreement, which was an important diplomatic success of the Russia-Ukraine war alongside hostage exchanges, is going to create serious problems on the African continent, which is already reeling from the climate crisis and the explosion of violence in the coup belt (Mali, Burkina Faso, Guinea, etc.). African countries are struggling with their economic recovery, as the COVID-19 pandemic was followed by high inflation. Many of these countries have important trade relations with Russia and Ukraine for the supply of grain products such as wheat, corn, and sunflower oil. Therefore, for the African continent, the end of the grain agreement threatens its access to food resources and increases food import costs. • Dr. Theodore Karasik is a senior adviser to Gulf State Analytics in Washington. Twitter: @KarasikTheodore

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