Wheat prices rose after attacks on Russian ships in the Black Sea

Global wheat prices rose after Ukraine used naval drones to disable a Russian oil tanker and warship. The reason for this was the threat posed to the key export route of goods from Russia through the Black Sea.

Bloomberg notes that Russia, as the largest shipper of wheat cargo, transports most of its grain by sea. This year, it plans to collect a second consecutive record harvest and sell it on the world market.

"The risk in the Black Sea is increasing every day, and any threat to Russian exports is much more serious than the threat to the Ukrainian export corridor," said the chief executive officer of broker and consultant IKON Commodities Ole Hou.

Thus, wheat futures on the Chicago Mercantile Exchange rose on Monday by 3.4% to $6.545 per bushel, and in Sydney traded at $6.4725 after Ukraineʼs attack on a Russian naval ship. At the same time, traffic in Novorossiysk port was stopped for several hours.

The publication writes that "Kyivʼs decision to start a war with Russia in the Black Sea occurred after Putin refused to extend the "grain agreement" on July 17, as a result of which Ukrainian grain exports decreased significantly, while Russian exports were not affected."

The Black Sea route also accounts for 15% to 20% of the oil that Russia sells daily on world markets, and it is also the main transit corridor for Kazakh oil.

Wheat futures remain down nearly 20% this year on the prospect of record harvests from key exporters and continued high global inventories.

• On July 17, the Kremlin informed that it was withdrawing from the "grain agreement". Already on July 19, Russian troops carried out a missile and drone attack on the port infrastructure of Odesa, targeting the grain and oil terminals. Ukraine said that Russian troops targeted 26 port facilities, five civilian ships and 180 000 tons of grain in nine days.