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2026-07-16 18:32:12
[Black Sea Attacks Ignite Wheat Prices, Ukraine's Grain Export Routes Nearly Paralyzed] ⑴ Ukraine and Russia exchanged missile and drone attacks in the Black Sea and Sea of Azov on Thursday. Ukraine claimed to have hit six Russian oil tankers and two tugboats, while Russia claimed to have struck Ukrainian vessels and several military industrial targets. ⑵ The Sea of Azov, a route for about a quarter of Russia's grain exports (the world's largest grain exporter), is currently experiencing restricted navigation in both directions, and this shipping restriction continues. ⑶ Two of Ukraine's three Black Sea ports are operating normally, but the port of Chernomorsk has significantly reduced its grain receiving volume, sending only about 900,000 tons of grain to the port since July, a significant decrease compared to the previous period. ⑷ Russia has also intensified its attacks on deep-water ports in the Odessa region. About one-third of Ukraine's Black Sea grain export capacity has been lost due to the attacks, prompting a stern warning from the farmers' union. ⑸ European wheat prices surged 7% on Wednesday. September milling wheat futures on the Euronext Paris exchange closed at €231.75 per tonne, a new high since February 2025, while Chicago wheat futures rose as much as 5% during the session. (6) Ukraine has called for the restoration of freedom of navigation in the Black Sea, and its Foreign Minister has publicly stated that the region is a major route for Ukraine's exports and is crucial for its economic survival during wartime. (7) If the situation in the Black Sea continues to deteriorate, global wheat trade flows will be forced to restructure, with the EU potentially absorbing some of the diverted demand. The geopolitical risk premium on grain prices is unlikely to subside in the short term.
