AMBASSADOR LINDA THOMAS-GREENFIELD: Thank you very much, Lisa. And let me say good morning to all of you. It’s been a while. I skipped out of New York for a couple of weeks, and so it’s great to be back and I want to thank all of you for joining us today.
I’m really grateful to have Ambassador O’Brien here in New York for a series of meetings on food security. As many of you already know, this is a really important issue for me. In March of 2021, just after I came to New York as our Ambassador to the UN, the U.S. made global food security a signature focus of our presidency of the Security Council. And again this May, we made the issue a key priority of our Security Council presidency, allowing us to focus on concrete solutions to bolster global food supply.
As part of that, Secretary Blinken made a trip to New York to convene an Open Debate of the Security Council on food security, and he also hosted over 40 countries – including both donors and countries most affected by food insecurity – for a Global Food Security Call to Action Ministerial.
At this meeting, we sought support for a roadmap outlining specific steps countries should take to help respond to this crisis. And since then, 100 countries have aligned with this roadmap. We also said that the Call to Action Ministerial was only the beginning of the conversation. That is why we followed up a month later with a visit to New York by U.S. Secretary of Agriculture Tom Vilsack. Secretary Vilsack exchanged views with the UN community on how we can work together to bolster food supply chains. And then, earlier this week, U.S. Special Envoy for Global Food Security Cary Fowler joined the UN High-Level Special Event on food security.
So today, we are continuing this conversation with another visitor from Washington: Ambassador Jim O’Brien. Before I turn it over to Jim, I want to note the announcement of a deal – brokered by the UN – to facilitate the export of up to 20 million tons of grain that Russia has held hostage in the Black Sea. And I know that the deal was supposed to be signed at 4:30 today Istanbul time, so that was a few minutes ago. So I assume they’re in the process of doing that right now. While we still need to review the agreement, we welcome this deal and we hope that it will help mitigate the crisis Russia has caused. But we will be watching closely to ensure that Russia actually follows through on any commitments they make. And we will continue to hold Russia accountable for other actions they have taken to exacerbate the food crisis – including stealing grain and sabotaging and destroying Ukrainian farmland, grain silos, and vital agriculture equipment and infrastructure. We will also continue to work to expand other routes – via road, rail, or river. In short, we’re impatient to get Ukraine’s grain to market.
While the UN-brokered deal is a positive step, let’s be clear: there is only one way to solve the many food supply chain disruptions this conflict has caused: Russia must end its war. And we will keep up the pressure on Russia so long as it continues this brutal, unjustified conflict.
Within the U.S. Government, Ambassador Jim O’Brien has played a key role in making sure the conflict does not disrupt agricultural exports from the region. Jim is the head of the State Department’s Office of Sanctions Coordination. As you know, our sanctions do not target trade in agricultural commodities into and out of Russia, despite what Russia would have you all believe. I’ll let Ambassador O’Brien go into more detail about our efforts to help international organizations, NGOs, and the private sector to understand and navigate our sanctions regime with confidence.
But we’re glad he’s able to spend the day with us here speaking with UN officials, permanent missions, the humanitarian community, and certainly with all of you. I think it will be incredibly helpful, and we hope this roundtable is also helpful to you as an opportunity for a deep dive on how we’re working to facilitate trade in agricultural products, lower food prices around the world, and ease food insecurity and famine in several parts of the world.
And with that, I’ll give the floor over to Ambassador O’Brien.
AMBASSADOR O’BRIEN: Thank you, Madam Ambassador. Thanks to all of you for being here. I’ll try to just elaborate on a couple of the themes of what you just heard.
The reason for my visit is to make clear that we are having an ongoing conversation with affected countries and companies and we want to resolve any problems with access to food and fertilizer regardless of the cause. One step of this was the roadmap that Ambassador Thomas-Greenfield just described and that Secretary Blinken and Secretary Vilsack launched several months ago, and that’s to address the broad problem of food insecurity. This has been growing over recent years, caused by many factors, but brought to a crisis point this year by Russia’s invasion of Ukraine. And so what we are offering to all of the affected countries is an opportunity to identify and then address – and, we hope, resolve – any issues that have come up in commercial markets that are affected by Russia’s invasion.
Now, how do we think we’re going to do that? Let me just say first off that, you know, how do we think about the effect of the invasion? And a simple way to do it is in terms of a couple of numbers. So one of them is Ukraine has 20 million tons of grain now in storage. In a normal year, that would have been exported in March and April and May. The grain average for a year is 5 to 6 million tons of grain reaching the Global South, overwhelmingly Egypt, Lebanon, the Horn of Africa, Iran, and China bought a fair amount. That grain sits in storage in Ukraine because Russia blockaded the ports.
Another number that’s helpful for those looking at it from the UN context: the World Food Program is providing assistance to the most vulnerable countries of the world. This year, it has not yet sourced about 2 to 2.5 million tons of the wheat that it needs to provide to these people. Now, that works out to be a number that it normally would have bought from Ukraine by now. Normally, WFP buys 50 percent of Ukraine’s wheat exports, and it was – in turn, Ukraine was about 50 to 70 percent of the amount of wheat WFP bought on global markets. So its shortfall right now in sourcing its grain and wheat is exactly what is sitting in storage terminals in Ukraine waiting for Russia to say yes, that this grain can flow.
So we’re very happy at the UN-brokered agreement that we hope is being signed now, but we are as – and the key word is impatient; we want to see the grain flow. And for people who are hungry around the world, that grain – a marker of success is whether that grain gets to them quickly. And so we’ll be measuring and working over the next months to see that that happens.
What else have we been doing? Well, around the Ukrainian grain, we’ve been working very closely with our Ukrainian partners and with the European Union to see that Ukrainian grain can reach global markets through land routes. So they come out through Romania, through Moldova down to the Black Sea, but also through Poland and Slovakia out to the ports on the Adriatic and the ports on the Baltic. This effort is bearing some fruit. What we think – well, we know in June that about 2.5 million tons reached global markets through those routes. Because Russia has destroyed 40 percent of Ukraine’s crop and export facilities, that’s getting close to the total amount that Ukraine is able to export on an ongoing basis. That’s been an enormous effort, but we know that price remains a problem, and the transportation costs of coming out through new routes that require new investment and a change in the orientation of the trade means that that grain is then pretty expensive and again emphasizes how important it is to have Odessa opened, because that is grain that will be inexpensive to ship and will be shipped from a place that is very close to many of the most needy populations, especially in the Horn of Africa, Lebanon, Egypt, and other places.
So we’re continuing the effort to make sure that Ukrainian grain can reach markets through the land routes, but we do see a reopening of the Black Sea ports as a critical step to improving food security.
Now, I’ll say a word or two about sanctions and then we’ll be happy to take questions. On the question of U.S. sanctions, so our U.S. sanctions are focused on reducing Russia’s ability to destabilize its neighborhood. So we care greatly about its ability to re-equip and retool its military, pay for its invasion, and pay for the processes that destabilize the neighborhood. We do not sanction Russian food and fertilizer. Russia is actually exporting a fair bit; it’s having a bumper crop this year.
There are complaints about the costs, but none of that is attributable to our actions. The main problem is Russia’s rhetoric and force posture in the Black Sea. The major insurance companies and shipping companies are reluctant to engage in particularly the main Russian ports on the Black Sea because Russia has said since February that it regards commercial activity as a potential threat. So what we need to see from Russia is a change in the rhetoric and the posture, and some of that’s technical and some of it’s just practical so that shippers don’t feel that they’re threatened. If we see that change, I think we’ll see Russian food and fertilizer be able to flow. We’re supporting strongly efforts with the UN to make clear to everyone that Russian food and fertilizer can flow.
Having said that, we know that uncertainty about what can move hurts the markets, drives up prices, and it can lead businesses not to engage in trade even when it’s allowed. So we are trying to be very clear that Russian food and fertilizer can reach the global markets. And we are doing that in private conversations with companies and we are doing that through our publications. And I hope we’re doing that through a roundtable like this one today.
And two things I will note: One is that last Thursday – so a week ago yesterday – the Treasury Department issued new guidance clarifying again that food and fertilizer exports are not affected. And the Treasury is very happy, and the State Department, we’re very happy to engage with companies that have specific concerns and to address those concerns, as Ambassador Thomas-Greenfield said several months ago, if that requires something as specific as a comfort letter; we’ll do that. But we also think that general guidance should provide companies with the comfort that they need to go ahead and get this – these vital supplies to market. We have also set up a website at the State Department – an email address where countries and companies can contact us with specific questions. And it’s – Andrew, it’s food –
STAFF: Foodsecurityhelpdesk@state.gov.
AMBASSADOR O’BRIEN: And this is the man who will be looking at the emails much of the time. I’m joined by a colleague from the State Department and from the Treasury Department, who I guess will be unnamed secret officials if asked to say something. But we’re here to – again, the whole point of our being here is to make clear to everyone that we very much want to identify and resolve any issues that people are experiencing regardless of what they think the cause is, and this is a part of our outreach.
With that, back to you.
AMBASSADOR THOMAS-GREENFIELD: Okay, you going to –
MS. HIBBERT: Thank you. Who has a question first? James?
QUESTION: James Bays of Al Jazeera. First a request – the Security Council might meet today, I think, possibly. There’s a French draft statement – PRST – that will be read out in the Council. If that happens, could you come to the stakeout and say something on camera for us, Ambassador, if possible, because we’d like to have you on camera in this story.
AMBASSADOR THOMAS-GREENFIELD: Well, I think we should be able to, but —
QUESTION: Yeah, but if possible —
AMBASSADOR THOMAS-GREENFIELD: Okay.
QUESTION: — it would be good to have you on the television.
You mentioned the wariness with regard to the Russian exports of grain of insurance and shipping companies. Do you think that will change as a result of the Russia-UN deal today? And how worried are you that shipping and insurance companies are still going to be concerned about the – getting the grain out of Ukraine, that this route through mined waters is going to be dangerous? Is there a potential problem there in getting the market forces to re-engage with this?
AMBASSADOR O’BRIEN: I think the two – no, it’s a great question. I think the primary factor is Russian behavior. So the cost of insurance and the risks to the ships went up when Russia issued its warning in February. And obviously this agreement is a sign that Russia now wants to see more normal commerce. But I think that needs to be followed up by demonstrations in practice, and that is the primary factor.
We’ve spoken with a number of the insurance and shipping companies who are involved. They’ve indicated that they’re very interested in seeing both Ukrainian grain and the Russian ports open up, but they need to know the risks are out there. The risk – the ships that have been sunk, have been sunk by Russian air activity and not by mines. And so the physical security will be important to verify, but I think the Ukrainians are quite comfortable that they can provide safe corridors provided that there is no risk from Russia.
MS. HIBBERT: We’ll take a question from that side of the room. Ibtisam.
QUESTION: Hi, my name is Ibtisam Azem from the daily Arabic Al-Araby Al-Jadeed newspaper. I have two questions. So you mentioned the sanctions and the reason you put them in place and their effect. So the first part, what role do you see that Iran and China are playing in this? And then in regards to the American economy, do you believe that the sanctions are also having a negative effect on the American economy? Are you rethinking some of the sanctions? Thank you. And when will you lift the sanctions? When the war is over or – thanks.
AMBASSADOR THOMAS-GREENFIELD: Why don’t you start, and then I’ll take the last part of the question.
AMBASSADOR O’BRIEN: Okay. The role – I think the primary role we see, particularly with China, is we would like to see it act like the great power that it is and provide more grain to the poor people around the world. China has been a very active buyer of grain, and it is stockpiling grain at home, and this at a time when hundreds of millions of people are entering the catastrophic phase of food insecurity. So we would like to see them play more of a role in making that grain available from their own stockpiles and by allowing WFP and others to obtain grain.
The first shipments out of Ukraine, first substantial shipments in April, were going – I think almost 40 percent dedicated to China, which was awkward because they were commercial buyers – they were the ones that bought the grain. It would have been much better to see that grain going to Egypt and the Horn of Africa and other places.
I don’t have a specific answer on Iran except Iran is a major purchaser of Ukrainian grain and they should stand to benefit by this grain re-entering the market. And that’s, we think, really at the (inaudible).
Are we rethinking the sanctions? We are – we believe the sanctions are having an enormous effect on Russia’s ability to de-stabilize its neighbor, and we’re committed to implementing them thoroughly and to continuing to degrade Russia’s ability to hurt its neighbors.
AMBASSADOR THOMAS-GREENFIELD: You —
MS. HIBBERT: We’ll go on.
AMBASSADOR THOMAS-GREENFIELD: Well, I just wanted to respond. You asked about when sanctions would be lifted, and again, the sanctions were imposed on Russia because of their unprovoked war and attack on Ukraine. And when they stop that attack, then that’s when we will consider what sanctions we might lift.
And in terms of the impact of sanctions on the U.S. economy, it is not the sanctions. The answer is the same that we give to the rest of the world. It is not the sanctions that are contributing to the impact on the economy. It’s supply chain issues. It’s the price of energy going up. And I can say categorically that the President is focused on this very, very keenly to address the impact of this war on the economy in the United States.
MS. HIBBERT: We’ll go to this side. Michelle, I saw you earlier.
QUESTION: No, no worries. Thank you. Michelle from Reuters. A couple of follow-ups. On China, like, how much – how much do you think they are in a position to offer from their stockpiles? And have you raised this with them? Has the U.S. raised this with them? And then a follow up to James’ question on insurers: If the ships don’t start to move under this deal, has consideration been given to something like sovereign guarantees? Is that something that insurance companies have asked for? What is the kind of contingency of the ships if this isn’t enough to kind of calm the market? If – what’s the contingency plan to get them moving out of Ukraine?
AMBASSADOR O’BRIEN: On China, I don’t have specific amounts. Yes, we have asked them not to keep building up their domestic stockpiles and have encouraged them to both allow grain to reach others but to make their stockpiles available for humanitarian purposes.
I think the second question – based on our conversations with insurers, if there’s full implementation of this arrangement, we do think that the – both insurance and ships will be available. So I think our focus is on the (inaudible) implemented fully. And I think there’ll be a combination of insurance mechanisms that could be there in Ukraine. Early in the conflict, Ukraine provided insurance for goods being shipped but also for the rolling stock and potentially the ships that could be used so they could provide a certain amount of protection. And I think the private insurance market will find a way to be involved.
QUESTION: Okay. And Ambassador, just another question in general. Is – how do you view this in terms of the Secretary-General and getting this deal and is this the biggest achievement of his time in office?
AMBASSADOR THOMAS-GREENFIELD: He described that. He described it in that way himself, that he thought that this was a major achievement. And should the deal go forward, I think we have to give him due credit for having worked so diligently to get this done.
I also wanted to comment on China. In addition to the issue of China stockpiling, the other issue is China contributing to the humanitarian demands. And I was at a hearing on Wednesday before the Senate Foreign Relations Committee, and USAID threw out some figures that were extraordinary in terms of contributions to World Food Program. We’ve given about $3.7 billion to World Food Program and China has given up only 3 million. And if China, again, wants to enhance its role as a global leader, it needs to be part of the solution and not just contribute to the problem.
MS. HIBBERT: We have time for one more before Ambassador Thomas-Greenfield has to go. Pamela, I saw you earlier, and then – so Ambassador O’Brien will continue the discussion, so it’s not over. It’s just that Ambassador Thomas-Greenfield has to depart soon.
QUESTION: Thank you so much to both of you. Ambassador, you mentioned one very technical question. You mentioned in your testimony, and Secretary Vilsack when he was here said about what you said today – 2 million tons went through the overland route. Is that – does that mean it’s now 18 million or was it different grain, the Ukraine grain that got out?
AMBASSADOR THOMAS-GREENFIELD: No, it’s only about two – two and a half million tons have gone out through these land channels and —
QUESTION: So what remains is somewhere around 18 —
AMBASSADOR THOMAS-GREENFIELD: No, I think we got 20 million tons. You may have newer —
AMBASSADOR O’BRIEN: Yeah.
AMBASSADOR THOMAS-GREENFIELD: There’s 20 million tons sitting now —
QUESTION: Sitting – oh, I see.
AMBASSADOR THOMAS-GREENFIELD: — on ships waiting to —
QUESTION: And so the 2 million came from —
AMBASSADOR O’BRIEN: There have been two harvests since the war started.
QUESTION: Okay. Got it. Got it.
AMBASSADOR O’BRIEN: So there was – normally they would have exported, say, 6 million in March, but they exported a few hundred thousand.
QUESTION: Got it.
AMBASSADOR O’BRIEN: So that’s accumulation. Then there was a winter wheat harvest that came in and that started to pile up the storage. So then it was about 700,000 – 1.7 to 2.5. So you accumulate that with that amount, and with 7 to 8 million out through the land routes. But now the summer wheat harvest just began. So I think last week they estimated 1.5 million came in, and that would just continue almost every week.
QUESTION: All right. And the next one is just on the Russia – the export of the Russian food and fertilizer. It’s not the – we had a 3:30 in the morning briefing from the UN. They didn’t mention the Russia – how much of the Russia food and fertilizer exports are part of the deal? I mean, in other words – and to what extent? You’re not a party to the agreement. To what extent were you consulted through the UN or – I mean, someone had to find out if there would be letters of comfort or OFAC regulations or whatever there needed to be to satisfy Russia.
AMBASSADOR THOMAS-GREENFIELD: There were extensive consultations with the U.S. in addition to having the Secretary General brief not just me and consult with me. He had discussions with Washington. And then Rebecca Grynspan also traveled to Washington with her team and to Russia to talk about the issues related to concerns about how to deal with some of the effects, the offshoot effects of sanctions.
QUESTION: Right. And so there were no direct Russian-U.S. —
AMBASSADOR THOMAS-GREENFIELD: No.
QUESTION: Okay. That’s all I needed. Thank you.
MS. HIBBERT: And thank you, Ambassador.
AMBASSADOR THOMAS-GREENFIELD: I’m sorry.
QUESTION: We really appreciate that you were able to join us.
QUESTION: Is it possible to ask a quick one before she goes? Will Mauldin with The Wall Street Journal. I came up from Washington, so just thought – didn’t know which one of you would be best placed to answer it. I just was curious if China supports this deal – has been supportive of the UN-brokered Black Sea grain deal? And if so, why do we think they’re supportive? And did – will that make a difference in its implementation?
AMBASSADOR THOMAS-GREENFIELD: I have not had any direct discussions with the Chinese on this deal. My assumption is if the Secretary-General was briefing me, he probably was briefing my Chinese counterpart. And I think this deal benefits China as much as it would benefit others because they benefit from the movement of wheat being put on the market. So I – again, I have not had a discussion with them, but my assumption is, yes, they would be supportive.
QUESTION: Thank you.
Original source can be found here.
