Black Sea Ports Disrupted, Global Food Market at Risk

The disruption of Black Sea ports has sent shockwaves through the global food market. The ongoing conflict between Ukraine and Russia has resulted in intense strikes on each other's ports, grain terminals, silos, and vessels since July.

According to SovEcon estimates, combined wheat exports from Russia and Ukraine in July-September may amount to approximately half of last year's volume. These two countries account for more than a quarter of global wheat trade, two-thirds of sunflower oil trade, and about one-tenth of seaborne corn shipments.

As a result, buyers are seeking alternative supplies from other regions. Egypt, the world's largest wheat buyer, had not received grain from the Black Sea region for about a month. Wheat prices have reached their highest level in three years.

Importers are looking to France, the Baltic countries, Romania, Argentina, India, and Australia to cover the shortfall. Golden Wheat, a Vietnamese company, was able to replace two of its shipments with cargoes from the Bulgarian port of Burgas but had to buy more expensive wheat in the United States.

Ukraine is trying to increase transshipment through the Romanian port of Constanța, but low water levels in the Danube and congestion on routes along the coasts of Romania and Bulgaria are hindering this effort. About 80 vessels have accumulated near Ukraine's Danube ports, while Ukraine's railway crossings with EU countries can handle about 180 grain wagons per day.

EU foreign policy chief Kaja Kallas stressed that alternative export routes cannot replace sea transport in terms of volume and warned of the risk of a new global food security shock.