Chicago wheat futures climbed to their highest level in more than three years as attacks on Black Sea ports and commercial vessels raised concerns over disruptions to grain exports from Russia and Ukraine. The most-active Chicago Board of Trade wheat contract settled 1.7% higher at $7.60¾ a bushel on August 27, after reaching an intraday high of $7.67½, its strongest level since July 2023.
The rally has accelerated sharply this month, with Chicago wheat gaining around 18% since the start of August. The market has been particularly sensitive to reports of renewed attacks on grain infrastructure and shipping, increasing fears that prolonged disruptions could restrict supplies reaching international markets.
Russia and Ukraine are among the world’s major wheat suppliers, making the Black Sea a critical hub for global grain trade. Recent attacks have affected ports, terminals and vessels, forcing exporters to rely more heavily on alternative routes. Ukraine’s grain exports fell to 539,000 tonnes during August 1-21, compared with 1.73 million tonnes during the same period last year.
Ukraine’s main Black Sea ports historically handled around 90% of the country’s grain exports, but repeated attacks have shifted more cargo towards Danube ports. Congestion and limited capacity on alternative routes are adding to shipping delays and costs, further complicating the movement of wheat to global buyers.
The market is also being supported by concerns over crop conditions. CME Group identified unfavourable winter wheat sowing conditions and weaker US spring wheat crop ratings as additional factors behind the recent price gains.
The disruption is also affecting freight markets. S&P Global reported that attacks on grain vessels around Russia’s Black Sea ports have increased risks for shipowners, with freight rates from the Black Sea to Egypt rising to around $70 per tonne.
With attacks continuing and alternative export routes facing capacity constraints, traders are closely watching Black Sea shipping flows. Any further deterioration could keep wheat prices elevated and increase costs for grain importers worldwide.