US Warns of Daunting Consequences if Ukraine Grain Deal Not Renewed

The United States is working to ensure that U.S. sanctions are not impeding the flow of Russian food and fertilizer to developing countries during talks to renew a U.N.-brokered deal on food shipments from Ukraine that will expire Nov. 19.

In an interview this week, the U.S. State Department’s top official on economic affairs, Ramin Toloui, told VOA there would be daunting consequences on global food security if Russia does not renew the deal.

“When there was a period, just in the last couple of weeks, where Russia suspended its cooperation in the deal, and we saw that global food prices increased quite sharply.  And then when Russia rejoined that deal, which we were very pleased to see, global food prices came down,” Toloui said Wednesday.

“So the consequence of not renewing the deal is very significant. We unfortunately got a preview of that just during this brief period of time, where Russia suspended its cooperation,” he added.

The United Nations- and Turkish-negotiated Black Sea Grain Initiative was signed in July and created a corridor for food and fertilizer shipments, but Russia has been reluctant to renew it.

A Reuters report said Russia has asked the West to ease sanctions-hit Russian Agricultural Bank, also known as Rosselkhozbank.

“We are doing a number of things to try to make sure that we’re facilitating Russia’s ability to export food and fertilizer to those who need it in the developing world,” said Toloui when asked if the U.S. would consider such demand.

The following are excerpts from VOA’s interview with Ramin Toloui, assistant secretary of state for economic and business affairs. They have been edited for brevity and clarity.

VOA: On November 19, the U.N.-brokered Black Sea Grain Initiative will expire unless renewed. What is the U.S. message to Russia?

Toloui: The Black Sea Grain Initiative, which has been advanced by the U.N. secretary general and with the support of Turkey, has been incredibly important to the world, and particularly people in developing countries. Under the initiative, about 10 million metric tons of grain have been exported since it was launched in July. And to put that in perspective, that’s equivalent to about a billion loaves of bread per month. … Two-thirds of the grain has gone to developing countries, and it has helped bring down global food prices from their highs, following Russia’s further invasion of Ukraine.

VOA: Would the U.S. consider easing some of the restrictions on Rosselkhozbank?

Toloui: This is a very important point. When the U.S. imposed sanctions against Russia for its invasion of Ukraine, we specifically carved out food and fertilizer, agricultural products from those sanctions. We don’t want U.S. sanctions to impede the ability of developing countries to import the Russian food and fertilizer that they need. So there’s what’s called a general license authorizing transactions in food and fertilizer. And we’ve also been clear in communicating with governments and the private sector that those sanctions don’t apply to transactions related to food and fertilizer.

VOA: To clarify, are you ruling out U.S. support to ease restrictions on Rosselkhozbank?

Toloui: Well, what we’re working very hard is to make sure that our sanctions are not impeding the flow of Russian food and fertilizer. In fact, in addition to the efforts I mentioned, we have established a helpline at the State Department where countries, companies can bring any difficulties that they’re having in transacting Russian food and fertilizer, so we can help resolve them.

VOA: Is that fair to say that Russia’s proposal to ease sanctions on that bank is off the table?

Toloui: As I said, we are doing a number of things to try to make sure that we’re facilitating Russia’s ability to export food and fertilizer to those who need it in the developing world.

VOA: Can you give us an update on the U.S. effort to promote global food security?

Toloui: Yes. We have taken this issue of global food security very seriously, even before Russia’s invasion of Ukraine.

But since the invasion, Secretary [of State Antony] Blinken convened a meeting of more than 30 ministers of agriculture, foreign affairs and development in April to launch the “Roadmap for Global Food Security Call to Action,” which lays out the international community’s plan for confronting these global food security challenges. More than 100 countries have now signed up to that plan, and it includes actions like increasing contributions to humanitarian organizations that are providing essential support to those at risk of starvation.

It includes making investments in agricultural capacity in developing countries to increase their food production now but also improve their resilience going forward.  And the United States has done a number of things to implement that roadmap.  We’ve committed $10.5 billion this year in development assistance and humanitarian assistance, which is addressing some of these priorities that were laid out in the roadmap, which has been endorsed by more than 100 countries.

VOA: Since you are heading to Asia, some of those countries are hurt by inflation and soaring food prices but have refrained from condemning Russia outright. What is the U.S. message to these countries, such as India and China?

Toloui:  Well, I think one of the most important things is that everyone be aware of how important this Black Sea Grain Initiative is to global food security.

As I mentioned, 10 million metric tons of grains have come out of the Black Sea and gone to the global markets. Two-thirds of that has gone to developing countries, and that’s equivalent to a billion loaves of bread per month.

And so it’s incredibly important that those Black Sea Grain Initiative be extended. We want all parties, including Russia, to agree to extending that before it expires on November 19.

So we’re encouraging countries around the world to speak about how important this Black Sea Grain Initiative is to the global food security challenges and support the U.N. secretary general’s efforts to renew the Black Sea Grain Initiative.

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