According to the Russian diplomatic mission in Geneva, discussions on a potential extension to a pact allowing the safe transport of grain from Ukraine’s Black Sea ports started on Monday between U.N. representatives and Sergei Vershinin, the deputy foreign minister of Russia.
By allowing Ukrainian grain that had been blocked by Russia’s invasion to be safely shipped from three Ukrainian ports, the Black Sea grain effort, which was mediated between Russia and Ukraine by the United Nations and Turkey last July, attempted to avert a worldwide food crisis.
The deal, which was extended for 120 days in November, is up for renewal on March 18.
Moscow has already signaled it will only agree to an extension if restrictions affecting its own exports are lifted, but many diplomats and senior officials, including Turkish Defense Minister Hulusi Akar, are optimistic that the deal will be renewed.
Russian officials say that although the country’s agricultural exports have not been explicitly targeted by the West, sanctions on its payments, logistics and insurance industries have created a barrier for it being able to export its own grains and fertilizers.
United Nations trade official Rebeca Grynspan and aid chief Martin Griffiths arrived at the U.N. European headquarters in Geneva on Monday morning, without making a comment.
Two sources involved with the talks said they were initially scheduled to last just one day but could be extended as needed.
News of the talks led to a fall in wheat and corn prices. Ukraine is a major exporter of both grains.
“Wheat and corn markets are weaker today as the talks start about extending the safe shipping agreement for Ukraine’s exports,” said Matt Ammermann, StoneX commodity risk manager.
“As such a large wheat and corn exporter, Ukraine’s supplies are vital to world markets.”
Wheat prices on the Chicago Board of Trade were down 0.9% at $6.73-3/4 a bushel at 1152 GMT while corn futures had fallen 1% to $6.11-1/4 a bushel.
“I think there are expectations in grain markets that the agreement will be extended with the deadline now only a few days away,” Ammermann said.
“Russia and Ukraine will probably not get all that they want, but I think importing countries will have been lobbying behind the scenes to get the shipping agreement extended.”
China is the largest recipient of grain shipped through the corridor.