Ukrainian grain ships are sailing through safe waters, but the economy is still sluggish

  • A ship carrying grain from Ukraine was inspected in Turkey
  • A ship bound for Lebanon passes the Bosphorus
  • It was the first of its kind to leave Ukraine during wartime
  • But Ukraine’s leader says more is needed
  • Kyiv urgently needs to send 10 million tons to reduce the deficit

KYIV/ISTANBUL, Aug 3 (Reuters) – Ukrainian President Volodymyr Zelensky, downplaying the importance of the first grain export from his country since Russia invaded, said he would take part of the crop to sell to save its battered economy.

His comments to students in Australia by video on Wednesday came as the ship completed its inspection in Turkey before sailing through the Bosphorus Strait to Lebanon under a deal aimed at easing the global food crisis. read more

The ship Razoni left the Black Sea early Monday morning from Odesa carrying 26,527 tonnes of corn for the Lebanese port of Tripoli. Last month, the UN reached a deal between Moscow and Kiev. It followed a brokered grain and fertilizer export deal — a rare diplomatic breakthrough in a tug-of-war.

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But Zelensky, speaking through an interpreter, said more time was needed to see if other grain exports would continue.

“Recently, thanks to the UN in collaboration with Turkey, we received the first ship to distribute grain, but it’s still nothing. But we hope it will continue,” he told the students.

Ukraine, one of the world’s leading grain producers before the war, said it needed to export at least 10 million tons of grain to help urgently reduce a budget deficit that was running at $5 billion a month.

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US Secretary of State Anthony Blinken welcomed the grain export, but said it was “only the first step”.

A senior Turkish official said three ships could leave Ukrainian ports daily after Razoni’s departure, while Ukraine’s infrastructure minister said another 17 ships were loaded with agricultural goods and waiting to sail.

Ukraine’s forecast for the wartime 2022 harvest has increased from 60 million tonnes to 65 million-67 million tonnes of grain, Prime Minister Denis Schmikel said on Wednesday.

In a telegram message, he praised farmers who are continuing to harvest even in areas where shelling continues.

Ukraine, known as Europe’s breadbasket, hopes to export 20 million tonnes of grain from silos and 40 million tonnes from the current harvest, initially from Odessa and nearby Pivtenny and Chornomorsk.

“The war … is almost killing the economy. It’s in a coma,” Zelensky said. “Russia’s blocking of ports is a big loss for the economy.”

Despite signing the deal last month, Zelenskiy has repeatedly warned that Moscow may try to block exports.

Putin and Schröder

Russia, which has blockaded ports since launching its “special military operation” on February 24, has said it wants to do more to facilitate exports of its own grain and fertilizer.

It has denied responsibility for the food crisis, saying sanctions by the West, which see the war as an unprovoked imperialist-style Russian land grab, have reduced its exports.

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Russia has also claimed that the United States is directly involved in the conflict in Ukraine, as US spies have approved and coordinated Ukrainian missile attacks on Russian forces. read more

U.S. President Joe Biden, who drew China’s ire and Russia’s taunts during U.S. House Speaker Nancy Pelosi’s visit to Taiwan, has said Ukraine wants to defeat Russia and has provided billions of dollars in arms to Kiev. U.S. officials said they did not want a direct confrontation between U.S. and Russian soldiers.

Russia has been giving strong support to China in the Taiwan issue. read more

Ukraine said on Wednesday that any negotiated peace settlement with Moscow would depend on a cease-fire and the withdrawal of Russian troops, brushing off comments by former German Chancellor Heggerd Schröder who said Russia wanted a “negotiated solution”. read more

Schröder, a friend of President Vladimir Putin, said he met the Kremlin leader in Moscow last week. read more

Kremlin spokesman Dmitry Peskov said Putin also told Schröder that, in theory, he was willing to use the Nord Stream 2 gas pipeline to help boost gas supplies to Europe.

Germany and some other European countries are planning a winter supply crisis after Moscow cut gas supplies through another pipeline, Nord Stream 1, citing technical problems with gas turbines supplied by Siemens Energy. read more

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Report by Reuters Bureau; Written by Andrew Osborne and Nick MacPhee; Editing by Andrew Cawthorne and Angus MacSwan

Our Standards: Thomson Reuters Trust Principles.

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