Russia-Ukraine War Drives Wheat Prices to Record Highs

Global wheat buyers are bracing for higher costs as the Russia-Ukraine war shows no signs of abating. The Black Sea region, a crucial hub for grain shipments, has been severely impacted by attacks on vessels and port infrastructure since July.

This has triggered a price rally, with benchmark Chicago futures climbing 40% from June lows to a three-and-a-half-year high. Physical prices from alternative exporters have surged, threatening fresh bouts of food inflation for vulnerable consumers.

The constraints have forced most global importers to hold off making alternative purchases, hoping for an agreement between Russia and Ukraine. However, local supplies are running thin, especially in import-dependent Asia.