Russia-Ukraine War Drives Global Wheat Prices to Three-Year High
Global wheat buyers are bracing for higher costs as the Russia-Ukraine war shows no signs of abating. World prices have soared, with benchmark Chicago futures climbing 40% from June lows to a three-and-a-half-year high.
The conflict has brought cargo movements to a near standstill since July, triggering a rally in prices. Top wheat importers in Asia, the Middle East and Africa are struggling to secure supplies, as attacks on vessels and port infrastructure have severely impacted shipping.
Ole Hansen, head of commodity strategy at Saxo Bank, warned that 'The Black Sea is an important region for shipping grains, and if buyers are not able to get grain out of this region, they have to look elsewhere for supplies, which is going to drive prices up further.'
Indonesian millers are turning to other suppliers, including Argentina, and paying around 20% to 25% more for Australian wheat than the prices at which they previously booked Black Sea cargoes.