Black Sea Grain Blockade Threatens Global Food Inflation, Wheat Hits 3-Year High

Wheat prices surged to three-year highs as escalating Russian and Ukrainian attacks on Black Sea port infrastructure choke off grain shipments, threatening a global food supply shock. Combined Russian and Ukrainian wheat exports for the July-September harvest period are estimated at roughly half of last year's levels, according to researcher SovEcon. Russia and Ukraine account for more than a quarter of global wheat trade—a share comparable to seaborne oil passing through the Strait of Hormuz. Egypt, the world's largest wheat buyer, has received no Black Sea grain in about a month. Ukraine's Odesa ports, which handled 90% of its grain exports, face regular missile and drone strikes as storage capacity nears its limit. Bond investors say food supply risks are not yet fully priced into markets focused on energy costs. Turkey has prepared a proposal for a new Black Sea shipping corridor similar to the 2022 initiative it brokered.