Ukraine, Russia conflict puts grain port at risk
August 29, 2014
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KIEV, UKRAINE — Fighting between Russia and Ukraine is moving closer to Mariupol, which is home to one of the country’s major grain ports.
Russian forces have seized the Ukrainian town of Novoazovsk and several border villages in Donetsk region. The town is about 44 kilometers (27 miles) east of the port.
Prior to the conflict, the port handled 3% of the 5 million tonnes of grain exported each month by Ukraine. With Russian forces entering southern Ukraine, the port’s ability to ship grain is in question, according to multiple news reports.
Markets continued to react to the news, with U.S. wheat futures increasing 1.7% to a three-week high on Aug. 28.
Ukraine shipped 2.17 million tonnes of grain from Aug. 1-26, of which 1.19 million tonnes was wheat, according to UkrAgroConsult, an agriculture consultancy group. Ukraine is expected to produce 22 million tonnes of wheat this year for export and domestic use, according to the U.S. Department of Agriculture.
An extraordinary meeting of the NATO-Ukraine Commission (NUC) was held at NATO headquarters in Brussels on Aug. 29.
At the meeting, the Allies unanimously recognized Russia’s actions as an act of military aggression against Ukraine, and expressed strong protest to such actions, stressing that such actions will not remain unanswered.
NATO called for Russia to withdraw its armed forces from the Ukrainian territory and to remove them from the Ukrainian border to their permanent locations, to stop its support of terrorists acting in Eastern Ukraine, to come back to the frames of international law, to conduct concrete and verifiable steps toward political solution of the conflict.
NATO Secretary General Anders Fogh Rasmussen expressed strong solidarity with Ukraine.
“Russian forces are engaged in direct military operations inside Ukraine,” he said. “Russia continues to supply the separatists with tanks, armored vehicles, artillery and rocket launchers. Russia has fired on Ukraine from both Russian territory and within Ukraine itself. Moreover, Russia continues to maintain thousands of combat-ready troops close to Ukraine’s borders. This is a blatant violation of Ukraine’s sovereignty and territorial integrity. It defies all diplomatic efforts for a peaceful solution.”