Ukraine Pounds Russia's Black Sea Port, Sparking Wheat Supply Fears

Ukraine launched a massive overnight drone attack on Russia's Black Sea port city of Novorossiysk, putting two major grain terminals out of action. The attack has raised fears in global markets of a disruption to wheat supplies.

Russia is the world's largest wheat exporter, and most of its exports are shipped via its Black Sea ports like Novorossiysk. Ukrainian President Volodymyr Zelensky said on Telegram that Ukraine had hit Russia's Novorossiysk naval base with drones, missiles, and unmanned boats.

The attack has caused significant damage to the city, with at least two people killed, including an 8-year-old child. The Black Sea port's water supply has been suspended, and an emergency situation has been declared following the attack, which damaged four unspecified enterprises, more than two dozen residential buildings, and some educational facilities.

Chicago wheat futures rose around 3 per cent on Wednesday following reports of the Novorossiysk attack. Russian strikes on ships in the Black Sea have drastically reduced grain shipments from Ukraine, which is also a major grain exporter. Shipments tumbled 76 per cent in the first two weeks of August, versus the same period last year, Ukraine's agriculture ministry said.