Russia's Pull Out from Ukraine Grain Deal Creates Volatility in Global Markets

The Russian government's announcement on July 17 that it is pulling out of the Ukraine grain export deal has created great volatility in the global grain markets.

Ukraine has been one of the world's largest grain and sunflower oil exporting countries and reimposition of the Russian export embargo is deepening worries of global food supply.

UN Secretary-General António Guterres said on Monday that he deeply regrets Russia’s decision to terminate the Black Sea Initiative, in effect ending a “lifeline” for hundreds of millions worldwide facing hunger and spiralling food costs. 

Exporters have been exploring alternative routes via Polish or other European ports but due to the difference in railway line guages between Ukraine and the other countries the cargo will have to be transferred on to different trains at the border, which is not a very practical option.

Meanwhile, according to a BBC report, Turkey's President Recep Tayyip Erdogan will try to broker a deal with Russian President Vladimir Putin when he meets him in early August.

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