Ukraine wants the ships to keep exporting its grain despite Russian attacks. some are interested

LONDON (AP) — Russia has repeatedly fired missiles and drones at Ukrainian ports key to sending grain to the world. Moscow has declared large swaths of the Black Sea dangerous for shipping. Even the The United States said the ships are at risk to be objective.

There is still interest from shipowners in transporting Ukrainian grain through the Black Sea, if they can mitigate the risk, according to a major shipping group. And that’s a big if.

Despite warnings and attacks on ports, which have ravaged grain infrastructure, “shipping has always been very, very resilient in the face of these kinds of risks,” said John Stawpert, senior manager for environment and trade at the International Chamber of Shipping, which accounts for 80% of the world’s commercial fleet.

President Joe Biden elevated CIA Director William Burns to his cabinet. It is a symbolic move that underscores the intelligence chief’s influence and his work on US support for Ukraine.

The Vatican is going ahead with a plan to try to reunite Ukrainian children taken to Russia during the war with their families.

A prominent hardline Russian nationalist who accused President Vladimir Putin of weakness in Ukraine has been arrested on charges of extremism, a sign the Kremlin has hardened its approach to hardline critics after last month’s failed rebellion by the Wagner mercenary company.

Russian cruise missiles have destroyed agricultural storage buildings in the Odessa region. Ukrainian officials said three missiles hit early Friday.

The strikes this week came after Russia withdrew from a wartime deal that the UN and Turkey negotiated last year to provide safeguards for shipping companies in a bid to end a global food crisis. Ukraine, which, along with Russia, is a major supplier of wheatbarley and vegetable oil to developing countries—shipped 32.9 million metric tons of grain to the world and supplied 80 percent of the World Food Program’s wheat for humanitarian aid so far this year.

Following the collapse of the grain dealUkraine sent a letter to the UN International Maritime Organization establishing its own temporary shipping corridor, saying it would “provide guarantees of compensation for damages.”

But Russia warned this week that ships traversing parts of the Black Sea would be assumed to be carrying weapons to Ukraine. In an apparent tit-for-tat move, Ukraine said ships heading to Russian Black Sea ports would be considered “carrying military cargo with all associated risks.”

Russia’s Deputy Foreign Minister Sergei Vershinin said on Friday that the navy will check the ships to make sure they do not carry weapons before taking other measures.

Continued shipments from Ukraine will depend on vessels obtaining insurance for potential damage or injury and death to crew members and how security risks develop. Ships exporting grain from Ukraine can be worth tens of millions of dollars, have 20 to 22 sailors on board and also carry tens of millions worth of food, according to Jayendu Krishna, deputy director of maritime advisers at Drewry, a maritime research consultancy.

All ships go through threat assessments to allow crews to protect themselves against problems before they set sail, which has grown in importance as ships grapple with piracy, terrorism and war zones.

For the Black Sea, the risks for boats would be: exploding mines, becoming collateral damage in ports or being attacked themselves, which Stawpert said would be “a big escalation”.

“The million dollar question is whether the threats to the merchant marine are serious and whether they will be carried out. And there is no firm way of knowing until it actually happens,” Stawpert said, adding that he has yet to hear from insurers.

With Russia’s warnings, “insurers are unlikely to want to cover that risk,” said the International Union of Marine Insurance, which represents domestic and international marine insurers.

The group thought the owners were unlikely to endanger their ships and crews, which was echoed by Munro Anderson, head of operations at Vessel Protect, which assesses war risks at sea and provides insurance backed by Lloyd’s, whose members make up the world’s largest insurance market.

He did not speak directly about whether underwriting companies like his would take the risk, but said that without protections for ships like those they had under the grain deal, “safety conditions cannot be guaranteed.”

Krishna said the only way to mitigate risk was through insurance from the 12 providers that make up the P&I Clubs International Group, which offers liability coverage for about 90% of global cargo shipped by sea, according to its website.

“P&I clubs will be wary of even insuring” without a guarantee from the UN or some other body, he said.

The P&I Clubs International Group said its CEO was the only one who could comment and that he was on vacation. Individual clubs declined to comment or did not respond to calls or emails.

The head of the seafarers’ division of the International Transport Workers’ Federation, a crew union, said the question should be whether it is too risky at this time to ask seafarers to go to Ukrainian ports.

“Seafarers’ minds will not be on issues of insurance coverage, but rather on whether their lives are safe in the midst of fighting,” David Heindel said in a statement, adding that crews “should never be targeted just for doing their job.”

Meanwhile, some analysts expect that most of what Ukraine was going to send across the Black Sea will go by road, rail and river through europebut transportation costs will be higher and probably lead to less production per Ukrainian farmers.

Ukraine’s Foreign Minister Dmytro Kuleba said on Thursday that Ukraine has made progress in improving those routes, but the best way to export grains It is through the Black Sea. This is how 75% of the country’s grain reached the world before the war, say analysts.

In addition, the routes have created divisions in the European Union, with five countries saying on Wednesday they want extend the ban on grain imports from Ukraine until the end of the year.

While Poland, Slovakia, Hungary, Romania and Bulgaria will continue to allow grain to move across their borders to world markets, their bans could create challenges such as infrastructure backups that could give preference to local grain over products from Ukraine, said Carlos Mera, head of agricultural commodity markets at Rabobank.

All five countries say Ukrainian grain has flooded their markets, prompting a excess that lowered prices for their farmers and moving protests. They signed a joint statement ahead of EU talks next week, urging officials to work ways to bring Ukrainian food to the world without harming their agricultural industries.

It is another hurdle for Ukraine, and possibly for developing countries already struggling with high prices for local foodthey are helping to fuel hunger.

Wheat prices have risen around 17% over the past week, and poorer nations being forced to pay more on world markets for staple food ingredients like bread and pasta means “many millions of people are being pushed into food insecurity,” Mera said.