Turkey's role after the Black Sea grain deal collapse has become even more critical

Bulk grain cargo ship TQ Samsun is anchored in the Black Sea near the entrance of the Bosphorus Strait in Istanbul. AP Photo

During the 500 days since Russia’s invasion of Ukraine, the Middle East avoided a catastrophic food crisis, thanks in part to the Black Sea grain initiative. Russia’s decision to cancel that agreement is raising fears that the return of supply shortages and skyrocketing wheat prices could quickly plunge the most vulnerable countries of the region into crisis.

Countries such as Syria and Yemen, which are struggling to emerge from conflict and civil strife, may be most at risk. How grim the picture will become for these countries does not simply hang on decisions made in Moscow and Kyiv. A decisive role will also be played by Ankara, not only on account of its central position in Black Sea geopolitics, but because of Turkey’s central role in the Middle East’s wheat-to-bread supply chain.

Prior to the invasion, Ukraine was the world’s fifth-largest wheat exporter and one of the main suppliers to many Middle East countries located relatively short distances from its Black Sea ports. With the outbreak of the war, shipments out of these ports came to a complete standstill, stranding 20 million tonnes of grain. By the end of March 2022, the price of wheat shot to 64 per cent higher than the previous year and bread shortages began appearing across the Middle East.

The Black Sea grain initiative eased the crisis. According to a deal brokered by Turkey and the UN, Russia guaranteed the safe passage of grain-laden cargo ships from Ukraine’s Black Sea ports to Bosphorus Strait in exchange for Russian inspections of the ships in both directions to ensure they were not carrying weapons.

During the 360 days that the deal lasted, Ukraine exported a combined 32.8 tonnes of wheat, corn (maize), sunflower oil, and other agrifood products, according to UN figures. Wheat shipments, 51 per cent of the total, made up lion’s share of the exports. Even for the countries that did not directly receive any of these cereal grain shipments, there was an immediate benefit, as the additional supplies in the global market caused a desperately needed easing of prices. From July 2022 to June 2023, the UN Food and Agriculture Organisation’s Cereal Price Index witnessed a 14 per cent drop.

For highly vulnerable nations such as Syria and Yemen, Ukrainian grain also came via the food aid provided by the UN’s World Food Programme (WFP). Yet even under the Black Sea grain deal, the WFP’s cost to purchase grain rose by almost 40 per cent and the organisation sent significantly less food aid. The impact in the Middle East was greatest in Syria and Yemen, countries in which the WFP is most active.

Prior to this year’s earthquake, 51 per cent of the Syrian population (about 12.1 million people, according to UN figures) was deemed food-insecure, making Syria the sixth-highest food-insecure nation in the world. 2.7 million people in Syria live in a state of severe food insecurity. In Yemen, as high as 19 million people are deemed food-insecure, with about 3.5 million acutely malnourished.

Despite the great humanitarian need in distressed nations across Africa and Asia, most of the grain from the Black Sea deal went to high- and middle-income countries, with the top three – China (25 per cent), Spain (18 per cent) and Turkey (10 per cent) – receiving the majority. Turkey’s large portion, however, served to help ensure Iraq, Syria and Yemen’s food security due to its crucial role in Middle East food supply chains. While Turkey is customarily among the world’s top-five wheat importers, it is simultaneously the world’s 10th-largest wheat producer.

Turkey’s unusual profile in the global wheat market stems from the fact that it is the world’s largest exporter of flour as well as one of the largest exporters of pasta. Due to government regulation to safeguard its own domestic wheat supplies, Turkey’s lucrative flour and pasta exports must be made from imported wheat.

The top three export markets for Turkish flour are, in order, Iraq, Syria and Yemen. In Marketing Year 2021-22, Turkey exported 1.31 million tonnes of flour to Iraq and typically supplies about 87 per cent of Iraq’s flour imports. Because of rising oil prices concurrently increasing Iraq’s revenues, the country has been able to cope with the rising price of wheat.

Although Syria is a close ally of the Kremlin and imported about 1.5 million tonnes of wheat from Russia, the war-torn country has yet to restore its flour-milling capacity to pre-war levels. With only half of Syria’s flour mills able to operate at full capacity, the country increasingly relies on Turkish flour imports. In 2021-22, Turkey exported 330,660 tonnes of flour, equivalent to about 43 per cent of Syria’s domestic milling capacity. Despite its ties to Moscow, Syria is partially fed by Ukrainian wheat via its Turkish flour imports. Turkey performs the same role in the wheat supply chain to Yemen, having exported 249,713 tonnes of flour in the same timeframe.

Additionally, Turkey is reported to have exported about 400,000 tonnes of flour for humanitarian purposes in calendar year 2022.

If Ukraine chooses to continue its Black Sea grain exports, Turkey could continue to provide escort and inspections. Under such circumstances, it is unclear whether Moscow would risk a naval confrontation with Ankara. It is equally unclear whether Ankara would be willing to take the risk.

To ensure sufficient supplies of bread in many of the Middle East’s distressed regions, the international community needs to work to ensure an adequate wheat is supplied to Turkey. For Iraq, Syria, Yemen and other countries in the region, Turkey is the indispensable link in the wheat-to-bread supply chain in the Middle East.

Prof Michael Tanchum would like to thank Vicky Andarcia for her research assistance