Voting Closed:

RELIEF

First grain ship leaves under Russia deal

Kenya has traditionally dependent on wheat imports from Ukraine and Russia.

In Summary

•Turkish and Ukrainian officials say the ship left the southern port of Odesa early on Monday morning local time.

•Russia has been blockading Ukrainian ports since February, but the two sides made a deal to resume shipments.

Workers arrange bags of wheat in a godown at the Port of Mombasa/
Workers arrange bags of wheat in a godown at the Port of Mombasa/
Image: FILE

The first ship carrying grain has left a Ukrainian port under a landmark deal with Russia, in what could help ease the global food prices.

Turkish and Ukrainian officials say the ship left the southern port of Odesa early on Monday morning local time.

Russia has been blockading Ukrainian ports since February, but the two sides made a deal to resume shipments.

It is hoped the agreement will ease the global food crisis and lower the price of grain.

Turkey said the Sierra Leone-flagged vessel, the Razoni, would dock at the port of Tripoli in Lebanon, adding that further shipments were planned over the coming weeks.

The Joint Co-ordination Centre, set up in Istanbul under the deal, said the ship was carrying some 26,000 tonnes of corn and was expected to arrive in Turkish waters for inspection on Tuesday.

UN Secretary General António Guterres welcomed the departure of the ship and hailed Turkey for its role in working to implement the agreement.

"Today Ukraine, together with partners, takes another step to prevent world hunger," Ukraine's Infrastructure Minister Alexander Kubrakov wrote on Facebook.

"Unlocking ports will provide at least $1 billion in foreign exchange revenue to the economy and an opportunity for the agricultural sector to plan for next year."

While the sight of the Razoni, with her stowed white cranes and long blue hull, inching out into the mine-infested Black Sea represents a significant development, the operation will have to last for a sustained period for either Ukraine's damaged economy or tens of millions of people around the world to benefit.

But Mr Kubrakov emphasised that 16 other ships were waiting to sail out of ports in southern Ukraine, with Odesa, Chornomorsk and Pivdenny expected to be the main places of export.

Last month's deal - brokered by the UN and Turkey - took two months to reach and was set to last 120 days. It can be renewed if both parties agree.

The blockade of Ukraine's grain has contributed to a global food crisis with wheat-based products like bread and pasta becoming more expensive, and cooking oils and fertiliser also increasing in price.

Russia and Ukraine jointly produce nearly a third of global wheat supplies. In 2019 Ukraine accounted for 16% of the world's corn supplies and 42% of sunflower oil, according to UN data.

Ukraine's Foreign Minister Dmytro Kuleba called the shipment a "relief for the world" and urged Moscow to "respect its part of the deal". Kremlin spokesperson Dmitry Peskov told reporters in Moscow that the ship's departure was a "very positive" development.

International leaders gave the shipment a cautious welcome, with UK Foreign Secretary Liz Truss calling it "an important first step". But EU spokesperson Peter Stano said Russia must ensure the "whole deal" is met to resume Ukrainian exports around the world.

Under the terms of the deal, Russia has agreed not to target ports while shipments are in transit and Ukraine has agreed that its naval vessels will guide cargo ships through waters that have been mined.

One engineer working on the Razoni told Reuters news agency that he was worried about the danger of sea mines.

"We hope that nothing will happen and that we will not commit any mistake. This is the only thing that I fear during this trip, as for the other things, we are used to them as sailors," Abdullah Jendi said.

Turkey - supported by the United Nations - will inspect ships, to allay Russian fears of weapons smuggling.

Trust remains low between officials in Kyiv and Moscow, and last month the deal was thrown into chaos less than 24 hours after it was announced when Russia launched two missiles at Odesa port.

Odesa MP Oleksiy Goncharenko told the BBC he expected shipments to continue from the other ports on Tuesday but warned Russia might attempt to disrupt them with further military action.

"We see these awful missile attacks against Odesa in the last days - that is just their attempts to increase the risks for ship owners, for crew, not to come to Odesa," he said.

KENYA

Kenya has traditionally relied heavily on wheat imports from Ukraine and Russia, with the war leading to price increases of wheat flour and products in the country.

More than 80 per cent of Kenya's wheat import is sourced from the two countries with other major sources being Argentina and the US.

It is also a maize importer from the region and international markets.

The country has since been forced to seek alternative markets for its maize imports, with the latest being Zambia.

“We are working with countries that have enough maize to be able to bring cheaper maize into the Kenyan market to cushion Kenyans from the high cost of maize flour,” said Munya.

For wheat, it was looking at India and Serbia.

Gerald Masila executive director, of Eastern Africa Grain Council (EAGC), said Kenya and the East African region have continued to experience a wheat shortage because of the crisis in Russia and Ukraine.

Blockage of ports worsened the situation.

In the first half of the this year, prices have increased to over $580 dollars ( Sh67,291) per tonne of the wheat offered in the world market, up from an average of $280 Sh32,485.

The weak shilling against the US Dollar has also made imports more expensive with the global supply chain affecting shipping trends, which has further led to increased freight costs.

Last month, the country's inflation hit a five-year high of 8.3 per cent, mainly driven by rising food prices.

President Uhuru Kenyatta directed that the price of a 2kg packet of maize flour be lowered to Sh100, from Sh205.

Addressing the Nation from State House Nairobi, the President said the move is part of the government's stimulus programme aimed at cushioning Kenyans from the current high cost of living.

To further address the flour crisis, the president announced the suspension of the Railway Development Levy (RDL) and Import Declaration Fee (IDF) on all maize imported into the country.

WATCH: The biggest news in African Business