Proposed UN Ammonia Deal Would Stabilize Grains Deal: Diplomat

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An ammonia gas deal between Russia and Ukraine that the UN is seeking to reach could ultimately stabilize one on grain, a Western diplomat briefed on the matter told Reuters.

Under the proposed deal, the ammonia gas, owned by Russian fertilizer producer Uralchem, would be brought via pipeline to the Russia-Ukraine border. There it would be bought by US commodity trader Trammo, the diplomat said.

Trammo would take over the ammonia on its journey through Ukraine, paying pumping and transit fees, and sell it on world markets from Ukraine’s Black Sea, according to the proposal.

“Actual financial flows are not insignificant,” the Western diplomat told Reuters.

“The fact that a key Russian company exports through the same Black Sea corridors that Ukrainian grain passes through stabilizes the deal and could lead to a long-term extension,” the diplomat said.

The pipeline, which transports ammonia from Russia’s Volga region to Ukraine’s Black Sea port of Odessa, was built about 40 years ago and is designed to pump up to 2.5 million tons of ammonia a year.

Uralchem ​​did not immediately respond to a request for comment and Trammo could not be immediately reached for comment.

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