Russia to halt Ukraine’s grain exports.

Russia‍ Suspends​ Grain Deal with ⁣Ukraine ⁢After Bridge ⁤Blast

Russia halted participation on Monday⁤ in the year-old‌ U.N.-brokered deal which‍ lets Ukraine export grain⁣ through the Black Sea, ‍just hours ⁣after a​ blast knocked out ⁢Russia’s ‍bridge ‍to Crimea in what​ Moscow⁤ called a⁤ strike by Ukrainian sea drones.

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Russia said two civilians ⁤were killed and their daughter wounded in what⁢ Moscow cast as a terrorist attack on the road bridge, a‍ major artery for ‌Russian⁢ troops fighting ​in Ukraine.

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The⁤ Kremlin ​said there was​ no link between‌ the attack and⁤ its decision‍ to ⁢suspend ⁤the‌ grain deal, ⁣over what it called a ⁣failure⁣ to meet⁤ its‌ demands to‌ implement a parallel agreement‍ easing rules⁢ for its‌ own ⁢food ​and ⁤fertilizer exports.

“In fact, ⁤the Black⁢ Sea agreements ceased ‌to be valid today,” Kremlin spokesman​ Dmitry⁤ Peskov told reporters on a conference call. “Unfortunately,‍ the part of these Black ⁢Sea​ agreements concerning‌ Russia has not been implemented so far, ‍so⁣ its ⁣effect ⁢is ‍terminated.”

Turkish⁤ president Recep‌ Tayyip ‍Erdogan, the ​grain deal’s sponsor, ‍said he still believed Russian president Vladimir Putin wanted it to ⁣continue.⁢ The Russian and Turkish foreign ministers would talk later on Monday, he​ told reporters.

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“I⁣ hope⁢ that with this discussion, we can​ make‍ some ‍progress and continue ⁤on ​our way ⁣without a pause,” ⁢Erdogan said.

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Russia’s foreign ministry said it​ would consider rejoining the ​grain deal if it‍ saw‍ “concrete ⁤results” on its​ demands.

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The blast on the road bridge ‍to‍ Crimea could‍ have a direct impact ‍on Moscow’s ability to supply its troops in southern Ukraine,‌ and reveals the‌ vulnerability⁤ of⁣ Russia’s own Black Sea infrastructure to ​devices such as seaborne drones: small, ​fast remote-controlled boats ⁢packed with⁤ explosives.

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Images showed⁤ a section of ⁣the‍ road bridge ‌had come⁤ down and ​traffic was‍ halted in both directions, although ​a parallel railway bridge was still operational. Blasts⁣ were ​reported before dawn ⁤on⁢ the ⁢12-mile bridge, which Putin⁤ ordered ‌built ⁤after ‌seizing​ and annexing the peninsula from Ukraine in ⁣2014.

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Kyiv gave no‌ official account of ‍the blasts ⁢but Ukrainian media quoted ​unidentified ​officials ⁢as saying ‍Ukraine’s Security ‍Service​ was behind it.‌ Ukraine ‌has ‍long maintained that​ the bridge was built‍ illegally, and⁤ its ⁢use by ⁢Russia for military supplies makes‍ it ​a legitimate ⁢target. It ⁤was last hit by ⁣a massive explosion and fire in October.

Russia’s suspension ‍of the⁢ Black ⁢Sea grain deal ⁣could‌ drive ⁣up​ food prices⁣ across​ the ‍globe,​ especially in⁢ the ​poorest ‌countries. Ukraine ⁣and Russia are⁤ both ⁤among⁢ the‍ world’s⁣ biggest ⁢exporters ⁣of grain and other ‌foodstuffs.

The⁤ grain deal was hailed‌ as preventing a global food emergency when it was brokered ​by​ the United Nations ⁣and Turkey ‍last year, halting⁢ a de facto ⁢blockade of Ukrainian ports⁣ by Russia, ​which‍ agreed to let ships pass after inspections in ‌Turkey.

Global commodity‍ food prices rose on Monday, ⁤though the⁢ increase was limited, suggesting ⁢traders did not ⁢yet anticipate a severe supply crisis. The Chicago Board ⁤of ‌Trade’s most active wheat Wv1 contract⁣ was⁤ up 3.0% at $6.81-3/4‍ a bushel at 1056 GMT after earlier rising over 4%.

Putin had threatened​ last week‍ to walk out of the ⁢grain‌ deal, while ‍also saying Russia could return to it ​if its demands were⁣ met.

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“We can suspend our participation ‌in the deal, and if everyone once ‌again says that all ⁢the‌ promises made to us ‍will be fulfilled, then let‍ them fulfil this promise.⁤ We will ‌immediately rejoin⁢ this deal,” Putin said⁤ last week.

Western‍ countries say Russia is trying to use ​its leverage over the grain deal to weaken⁢ financial sanctions,‌ which do ‍not apply to Russia’s agricultural exports.

European Commission president Ursula von der Leyen described ⁣Russia’s ​suspension of⁢ the agreement as​ a “cynical‍ move” and‌ said the ⁣EU‍ would continue⁢ to ⁣try to secure ⁤food​ for poor countries.

Without Russia?

Russia has ⁣agreed three ⁣times in the past year⁢ to‍ extend the Black Sea deal, despite repeatedly threatening to ⁣walk out. It suspended participation after an attack on its⁢ fleet by seaborne Ukrainian ‍drones in October, ‍leading​ to a few days when⁤ Ukraine, Turkey, and the United Nations kept exports⁢ going‌ under the‌ deal without Moscow.

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Denys⁣ Marchuk, deputy ‌head of the Ukrainian Agrarian‍ Council, the ⁤main‌ agribusiness ‍organization‍ in Ukraine, ⁢said seaborne exports could‍ proceed again without Russian ⁤agreement.

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“If there⁣ will be safety guarantees​ from our partners, ⁢then⁣ why not ⁣conduct the grain initiative ‌without Russia’s ⁤participation?” ⁤he ⁤told Reuters.

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Any such resumption of Ukrainian sea exports without Russia’s blessing would‍ probably depend ​on ⁣insurers. ⁤Industry ‍sources told Reuters ⁤they ⁣were studying ​whether to freeze their coverage.

“Some underwriters will look to take advantage ​with‍ a hefty increase in rates. Others will ‌stop offering‌ cover. The [key] ​question ‌is ⁣whether​ Russia⁢ mines the​ area which would effectively⁣ cease any form of cover ‍being ​offered,” one insurance‍ industry source said.

The latest blast⁤ on Russia’s ⁢bridge to‍ Crimea ⁤follows⁤ months of Ukrainian strikes on Russian supply lines ‍as Kyiv pursues a counteroffensive‌ to ⁤drive Russian forces‌ out​ of its ‍territory.

Unverified ‌imagery showed ​a‍ section‍ of road ​on the bridge had split and was listing to​ one side, with metal barriers ‌buckled. Dash‌ cam ‍footage showed drivers ⁤braking ‍sharply shortly after the incident.

Russian officials said a⁢ Russian ‍Su-25 fighter-bomber crashed into ‌the Sea ⁢of​ Azov on Monday, ⁣but the pilot ejected ‍successfully ​and ‌there was no indication of an⁣ attack. The bridge to Crimea spans⁣ the mouth of the sea.

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The Ukrainian counteroffensive, which ⁤began last month, has⁢ so far been slow⁣ going, ​capturing⁤ a⁢ string of⁣ small ⁣hamlets ​in the south⁤ and some territory around Bakhmut, ​the ​small eastern​ city Russia ‍captured in May after ‌the ⁢war’s deadliest⁣ combat. ‌Kyiv​ said on⁣ Monday its forces ⁣had captured another 18 sq km of ‌territory over the past week, ‍bringing the total captured‍ to more than 210 sq km.

(Reporting by Lidia Kelly ⁤in ‍Melbourne, Guy Faulconbridge in Moscow, Max Hunder in Kyiv and Reuters bureauxWriting ​by Peter GraffEditing by ‌Philippa Fletcher)