Ukraine finalizes deal with insurers to cover Black Sea grain ships

Ukraine is close to finalizing a scheme with global insurers to cover grain ships traveling through its Black Sea ports, according to reports.

Oleksandr Gryban, Ukraine’s deputy economy minister, told the Financial Times on Monday that the deal is “currently being pursued and actively discussed” between the relevant ministries, local banks and international insurance groups, including Lloyd’s of London.

The scheme, which could be in place as early as next month, could cover five to 30 ships against damage sustained during travel through the Black Sea, Gryban said.

Insurers and a local state-owned bank would share the risk, the FT reported, with the public portion of the risk backed by Ukraine’s state road fund.

In July, Russia pulled out of the U.N.-backed Black Sea grain deal which allowed Ukraine to export wheat and other produce through its ports. After leaving the deal, the Kremlin warned that ships traveling to and from Ukrainian ports could be seen as military targets.

Last week, Russian forces fired warning shots and boarded a Palau-flagged cargo ship in the southwestern Black Sea that Ukraine identified as Turkish, in an act “tantamount to piracy,” according to James Stavridis, a former NATO commander.

But on Friday, a cargo ship successfully made the voyage across the Black Sea from Ukraine to Turkey, using a “humanitarian corridor” established by Kyiv. The German-Chinese owned Joseph Schulte, which was stuck in Ukraine’s southern port of Odesa for a year and a half, made the journey to Turkey’s Bosphorus Strait despite Russia’s blockade.