When Russia announced it would not renew the Black Sea Grain Initiative on July 17, anger and disappointment mixed with a sense of resignation. The news was hardly unexpected. For months, President Putin had threatened to pull out of the deal, and nothing in Russia’s conduct of the war to date suggests the leader is concerned about the affordability of food in poor, food-import dependent countries, or the protection of an economically viable grain sector in Ukraine. Already, the bombing of the Nova Kakhovka dam in June has jeopardized 600,000 hectares of irrigated land. Land routes through the western border of Ukraine have been slow and limited, creating tension with grain growers in Poland, Hungary and Romania, who argue the volume of grain coming from Ukraine is creating local gluts and price falls.
This does not mean the end of the deal is insignificant. Ukraine and Russia are both still an important source of exports for world markets. Several countries rely on their wheat, corn and sunflower oil as an integral part of their food supply. Many of these countries are poor, which means they are not easily able to maintain their imports when prices rise. Closing the Black Sea again will drop the price of Ukrainian (and Russian) wheat because there will be less opportunities to move the grain to market. The price of wheat from elsewhere, such as France, Argentina and the United States, will rise meanwhile as demand shifts to more accessible suppliers. Overall price volatility will rise, as will the transaction costs as options to move the grain narrow. Importantly, Russia and Ukraine are also key sources of fertilizer and fossil fuels, both of which have become integral to many food systems, despite being expensive and polluting.
This latest move in the brutal war Russia is waging for Ukraine is a sharper, yet also more contained shock than the many other threats facing low-income food importing countries — notably climate change, but also conflicts closer to home. For food-insecure countries, the lessons underlying Russia’s decision to kill the grain deal are clear: To be resilient, they must diversify their sources of food (both geographically and to include a greater variety of food types so as to improve nutritional outcomes); their governments and investors must focus on local and regional food systems and on agroecological approaches to farming, not least so as to strengthen rural communities and infuse capital into their local economies; and governments must reduce their reliance on expensive and volatile imports for food security (including food, fossil fuels and fertilizer imports), so as to limit their exposure to debt and strengthen their position in multilateral negotiations.
