EU currently has no funds to organise transit of Ukrainian grain

The European Commission currently has no funds to organise the transit of grain from Ukraine by land following Russia’s withdrawal from the Black Sea Grain Initiative.

Source: Reuters; European Pravda

Details: In a letter dated July 21, Ukraine’s Agriculture Ministry asked EU trade chief Valdis Dombrovskis for the Commission to provide financial aid for the extra transport cost of using alternate EU routes known as Solidarity Lanes.

Ukraine estimates the extra cost to be US$30-40 per tonne of agricultural exports. In the letter, Ukraine also asked the EU to extend the Solidarity Lanes by 1-1.5 million tonnes a month through "green corridors" to the Adriatic Sea, the Baltic States, Germany and the Netherlands.

But sources in the European Commission told Reuters that the EU currently has neither additional financing nor a specific plan to support Ukrainian exports.

One diplomatic source said that funding for Ukraine’s needs could only come after the mid-term budget review, which might take another several months, even though the autumn corn harvest is expected to begin soon.

The source also said that pushback against importing Ukrainian corn to the EU has been growing in the EU, "as some states do not see the value in paying for the extra transport cost because of this ban," Reuters reported.

"It's not the Commission's role to provide (transport) insurance. States can give guarantees but there are no conclusive discussions," the source with knowledge of the Commission's discussions also told Reuters.

Background:

• Ukraine has been forced to export its agricultural products by land and river following Russia’s withdrawal from the Black Sea Grain Initiative and its attacks on Ukrainian ports, which have blocked Ukrainian sea exports.
• The US State Department said that Russia may be preparing a false-flag operation in the Black Sea amid a series of attacks on port infrastructure in southern Ukraine. James Cleverly, UK Secretary for Foreign Affairs, said he was concerned about the possibility of Russia attacking civilian vessels in the Black Sea and hindering the export of Ukrainian grain.

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