Global wheat prices have surged, nearing a three-year high, as attacks on Black Sea grain infrastructure by both Russia and Ukraine have severely disrupted export logistics. This includes strikes on Ukraine's largest port on the Danube and Russian terminals in Novorossiysk over the past two weeks. The ongoing conflict and targeted attacks on agricultural exports are causing analysts to fear a significant global food price shock.
The disruption in Black Sea and Sea of Azov ports could reduce global grain supplies by an estimated 86 million tonnes this year. Russia, the world's largest grain exporter, and Ukraine, ranking fifth, together account for approximately 30% of global wheat exports. Of the potential reduction, Russia accounts for 52 million tonnes and Ukraine for 34 million tonnes. Ukraine's agricultural exports alone could fall by 54% to 29.6 million tonnes due to Russian attacks on its Black Sea ports.
Black Sea grain export capacity for Russia and Ukraine has virtually halted, with more than 97% of the capacity shut down. These two nations previously exported an average of 7.2 million metric tons of grain monthly from the region. Current wheat futures have risen over 17% since early July and are now about 30% higher than a year ago. Global wheat buyers are now bracing for tighter supplies, with Asian mills, which had booked Black Sea wheat for July to September, facing increased prices and seeking alternative suppliers like Australia, where wheat is quoted at $315 to $320 per ton to Asia.
