One of the most effective tools of the world’s geopolitical turmoil continues to be food. The surplus of Ukrainian grain brought down the price of European producers, who managed to win EU aid of up to 100 million euros through protests.
However, the situation is not calming down, because Moscow says that it will not extend the agreement on the free transit of Ukrainian grain, which expires on May 18, if their demands are not adopted. The consequences of the crisis are also felt by Serbian farmers, who these days are offered 20 dinars for a kilogram of new crop wheat.
Cheap surplus wheat from Ukraine has driven down the price forfar Romanian, Hungarian, Slovak and Polish farmers. By blocking the port of Constanta, they won a ban on the import of Ukrainian grain, but transit remained free. Experts say that Ukrainian grain still goes astray, and that due to poor control, it ends up in the silos of some of those countries, writes RTS.
Although it previously criticized the disunity, the EU approved aid for farmers of up to 100 million euros, but that is not the end of the problems. Russia says it will review participation in the Safe Routes for Food agreement, which expires on May 18.
They presented a five-point demand. The most important thing is to allow them to import agricultural machinery and export fertilizers, as well as to return the Russian Agricultural Bank to the international Swift payment system.
Moscow and Washington are at odds over the agreement
Russian representative to the United Nations Gennady Gatilov in Geneva says that the UN is “serbiserbian faan fadoing its best” and that we will see the results of its negotiations with the US administration and the EU.
“There is no significant progress. The part of the Black Sea deal that deals with Ukraine is working, but not the one that deals with the Russian part. Those two parts of the agreement must be equal,” says Gatilov.
During that time, the American ambassador to Ukraine, Brigitte Brink (Bridget A. Brink), together with the assistant of the Ukrainian Prime Minister, visited Ismail, Reni, Orlovka – the key regions for export and import.
The American ambassador to Ukraine points out that there is no time to lose because Russia has put enormous pressure on the agreement on the export of grain from the Black Sea.
“Russia deliberately and very cynically controls and limits the number of ships that can enter and leave with grain, which means that people who need food cannot get to it,” Brink said.
Lower price in Serbia as well
The price of Ukrainian wheat of 16 dinars without transport lowered the purchase price in our country as well. In January, it was 35 dinars per kilogram. We haven’t sold the old crop yet, and the offer for the new one is 20 dinars.
“Last year was dry. We are all in the deep red. This year should pay back part of the debt from last year and leave us with a positive zero to survive. Anything below 42 dinars per kilogram of wheat is low, because the production price costs us 38 dinars,” explains Vukašin Baćina from the Association of Farmers from Banat.
For agro-analysts, the economic crisis and the war in Ukraine are increasingly being used to unjustifiably lower prices for farmers, i.e. to raise prices for end customers.
“The situation in Ukraine has disrupted the world market, the psychology of demand and the perception of the entire market. That situation serves as an excuse for building a risk premium into the prices of Its products. To a large extent, we have abuse,” says Žarko Galetin from Novi Sad’s Product Exchange.
Aleksandar Bogunović from the Serbian Chamber of Commerce says that it can be expected that the price of wheat will go “down” when the harvest begins.
“The Ukrainian agreement can change the situation so that if there is a ban on passage through the Black Sea corridor, prices can also go up.” “The one who offers bears a certain risk,” says Bogunović.
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