Grain shipments increase out of Ukraine, potentially helping to ease global food prices

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• Judy Woodruff:

  In Western Ukraine today, President Volodymyr Zelenskyy hosted Turkey's President Recep Tayyip Erdogan and the U.N. secretary-general, António Guterres, both architects have a deal last month that allows Ukraine to export food amid the war and a global food shortage.

  But that — but has that U.N. brokered deal been effective in achieving its goals thus far?

  Nick Schifrin has the story.

• Nick Schifrin:

  The U.N. called it a beacon of hope, one of the world's breadbaskets once again able to export.

  For three weeks, ships carrying Ukrainian grain, sunflower, soya and wheat have left Ukrainian ports through a Russian blockade. Today, three of the guarantors of that deal met in Ukraine's west to assess how far they'd come and how far they still had to go.

• Volodymyr Zelenskyy, Ukrainian President (through translator):

  There is a global need for more ships that can export Ukrainian produce in a secure way. Our country will be a guarantor for global food security.

• Nick Schifrin:

  For years, Ukraine help provide that guarantee. With Russia, it exported one-quarter of the world's wheat. But the war, combined with a historic drought in the Horn of Africa and complications from COVID, have created a global food crisis.

  The U.N.-brokered deal is designed to allow Ukraine to export 22 million tons of grain. The first Africa-bound ship left yesterday. The brave commander carries World Food Program-purchased cargo destined for Ethiopia; 23,000 metric tons of wheat will go to a nation with 20 million people facing hunger.

  But, so far, most exports are not going to those with the most need. Of 25 ships, more than a quarter have gone to Turkey, Iran and South Korea. Each received five. Next on the list, China, Ireland and Italy.

  The exports so far are a fraction of what's needed; 700,000 tons of food have left Ukrainian shores; 20 million tons remain trapped in Ukrainian silos.

• António Guterres, United Nations Secretary-General:

  Let's have no illusions. There is a long way to go before this will be translated into the daily life of people at their local bakery and in their markets. Supply chains are still disrupted, and the energy and transportation costs remain unacceptably high.

• Nick Schifrin:

  And some of the exports aren't arriving at their intended destinations. The very first ship that left Ukraine arrived not in its original reported destination, Lebanon, but in Russia ally Syria. Syria also receives stolen Ukrainian grain on a Russian ship that arrived just today.

  And for more on food exports from Ukraine, we turn to Joe Glauber, senior research fellow at the International Food Policy Research Institute. He previously served as the chief economist at the U.S. Department of Agriculture.

  Thank you very much. Welcome to the "NewsHour."

  How much of an impact right now is this deal having?

• Joseph Glauber, International Food Policy Research:

  It's small, but it's — it hopefully will get bigger.

  Right now, roughly 700,000 tons have moved. That's about a 10th of what Ukraine does on a monthly basis during their peak season. And this is their peak season as we come into wheat harvest, and they want to be shipping that out to the rest of the world. 7

• Nick Schifrin:

  Seven hundred thousand, just to put that in perspective, the goal is for 20 million tons to be exported.

• Joseph Glauber:

  Yes.

• Nick Schifrin:

  Is that even realistic?

• Joseph Glauber:

  Well, I think they have serious storage problems.

  Remember, they have a crop from last year. That's been trapped inside of Ukraine. They're in the process of harvesting a wheat crop. And in the fall, they're going to have a corn crop and barley crop and other crops that are going to come in.

  What that put stress on is the storage capacity they have, even with this potential of exporting a little bit more out of those Black Sea ports.

• Nick Schifrin:

  One of the good signs that we have seen so far, according to the secretary-general today, is that prices have come down for the rest of the world.

  The FAO says its food price index fell by 9 percent in July, the largest decline since 2008. So is that a sign that this deal, at least initially, is having some positive impact?

• Joseph Glauber:

  Well, it's a whole bunch of factors, actually.

  One is, Russia is exported a lot more than I think was initially thought. We have a good crop coming out of Canada. But, again, no question, the fact that we're actually able to get grain out of Ukraine through those Black Sea ports is a very positive for world food prices.

• Nick Schifrin:

  As we pointed out, these ships have gone to Turkey, South Korea, even Ireland and Italy, only one to the Horn of Africa, at least so far. Why?

• Joseph Glauber:

  Well, a lot of the grain that left — that's left Ukraine in the last couple of weeks through this corridor were ships that were in — docked in the Ukraine ports before the war.

  And so they were targeted for those buyers. And that included, yes, a lot of corn going to Europe. It included a little bit going to the Middle East, and then some wheat going to the Horn of Africa.

  And so where I think that will — the shift will change as we see more wheat coming out of Ukraine.

• Nick Schifrin:

  The Joint Coordination Center, the U.N.-run body that's coordinating this in Istanbul, said to me today that, while there have been 25 ships that left Ukraine, 20 are arriving in Ukraine now.

  Is that a sign of what you were just suggesting, that this food is now going to be going to more places?

• Joseph Glauber:

  Yes, I think we will see a mix of buyers.

  Remember that, if you look at who the markets that Ukraine would typically ship, a lot of — ship to, it's a lot in North Africa. It's a lot in the Middle East as far as wheat concerned.

  For corn — and they ship a lot of corn around the world. A lot of that goes to China. A lot of that goes to Europe. Now, some of that goes to the World Food Program and others that help alleviate hunger and other important things like that.

• Nick Schifrin:

  Beyond this deal, do you believe that there's enough being done to ease a global food crisis?

• Joseph Glauber:

  Well, the real issue, I think, long run for Ukraine is ending the war and bringing back their agricultural system to some sort of normalcy.

  I think, with Ukraine hampered by a war going on and the fact that they aren't shipping as much as they could ship normally, that that means lower prices for producers. That means less production. And because of the important role Ukraine plays in world markets, I think that means continued tight supplies.

  Because overall global stock levels continue to be fairly low, that means any sort of disruption in terms of droughts or other things could really cause price spikes. So that's real — the real concern longer run as we move forward over the next year or so.

• Nick Schifrin:

  And how important is it to solve some of these problems, given how acute this global food crisis is?

• Joseph Glauber:

  Yes, I think is extremely important to at least get this corridor up and running, at least make sure that we can get exports back to some sort of level that's closer to what they normally would be shipping.

  But, obviously, the real goal is to get an end to the war.

• Nick Schifrin:

  Joe Glauber, thank you very much.

• Joseph Glauber:

  Thank you.