Ukrainian grain ship heads for safe waters, but the economy is still in the doldrums

  • Ukrainian grain vessel inspected in Turkey
  • Ship, bound for Lebanon, transits through the Bosphorus
  • The expedition is the first of its kind to leave wartime Ukraine
  • But the Ukrainian leader says much more is needed
  • Kyiv must urgently ship 10 million tons to reduce its deficit

KYIV/ISTANBUL, Aug 3 (Reuters) – Ukrainian President Volodymr Zelenskiy has dismissed the significance of his country’s first grain shipment since the Russian invasion, saying it was carrying a fraction of the harvest Kyiv owes sell to help save its crumbling economy.

His upbeat comments, by video to Australian students on Wednesday, came as an inspection of the ship was completed in Turkey before it sailed through the Bosphorus Strait en route to Lebanon as part of a deal to mitigate a global food crisis. Read more

The ship, Razoni, left Odessa on the Black Sea early Monday, carrying 26,527 tonnes of maize to the Lebanese port of Tripoli. This followed a UN-brokered grain and fertilizer export deal between Moscow and Kyiv last month – a rare diplomatic breakthrough in a long war of attrition.

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But Zelenskiy, speaking through an interpreter, said more time was needed to see if more grain shipments would follow.

“Just recently, thanks to the UN in partnership with Turkey, we had a first ship with the delivery of grain, but it’s still nothing. But we hope it’s a trend that will continue,” he told the students.

He said Ukraine, one of the world’s leading grain producers before the war, needed to export at least 10 million tonnes of grain to urgently help reduce its budget deficit which stood at 5 billion. dollars per month.

US Secretary of State Antony Blinken welcomed the grain shipment but also said it was “just a first step”.

A senior Turkish official said three ships could leave Ukrainian ports every day after the Razoni sailed, while Ukraine’s infrastructure minister said another 17 ships had been loaded with agricultural products and were waiting to set sail.

Ukraine’s forecast for its 2022 wartime harvest has dropped from 60 million tonnes to 65 to 67 million tonnes of grain, Prime Minister Denys Shmygal said on Wednesday.

In a Telegram message, he praised farmers for continuing to harvest, even in areas where shelling continues.

Ukraine, known as the breadbasket of Europe, hopes to export 20 million tonnes of grain stored in silos and 40 million tonnes of the current harvest, initially from Odessa and around Pivdennyi and Chornomorsk.

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

Zelenskiy has repeatedly warned that Moscow may try to hinder exports despite signing the deal last month.

PUTIN AND SCHROEDER

Russia, which blocked ports after launching its “special military operation” on February 24, said it wanted more to be done to facilitate exports of its own grain and fertiliser.

He denied responsibility for the food crisis, saying sanctions from the West, which sees the war as an unprovoked imperial-style Russian land grab, have slowed his exports.

Russia also said the United States was directly involved in the conflict in Ukraine because American spies were approving and coordinating Ukrainian missile strikes on Russian forces. Read more

US President Joe Biden, the object of China’s fury and Russia’s scorn during a visit to Taiwan by US House of Representatives Speaker Nancy Pelosi, has said he wants Ukraine to defeat the Russia and supplied billions of dollars worth of arms to Kyiv. He said US officials did not want a direct confrontation between US and Russian soldiers.

Russia has expressed strong support for China in the Taiwan conflict. Read more

Ukraine said on Wednesday that any peace deal brokered with Moscow would be conditional on a ceasefire and the withdrawal of Russian troops, brushing aside former German chancellor Gerhard Schroeder who said Russia wanted a “negotiated solution”. Read more

Schroeder, who is a friend of President Vladimir Putin, said he met the Kremlin chief in Moscow last week. Read more

Kremlin spokesman Dmitry Peskov said Putin also told Schroeder that in theory the Nord Stream 2 pipeline was ready to be used to help boost gas supplies to Europe.

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

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Reports from Reuters offices; Written by Andrew Osborn and Nick Macfie; Editing by Andrew Cawthorne and Angus MacSwan

Our standards: The Thomson Reuters Trust Principles.

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