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Wheat prices extended their run near a three-year high Thursday as escalating Russia-Ukraine tensions disrupted grain shipments through the Black Sea, tightening export flows from two of the world's most important wheat suppliers.
Chicago wheat futures climbed to $7.67 a bushel at the intraday high Thursday before paring some of their gains, touching their highest level since July 2023.
As of 1 p.m. GMT, wheat prices were up about 13.5% over the month, while year-to-date gains were nearing 50%, market data shows. Prices were also hovering 7.8% higher than a week earlier and about 30% above their end-of-June low.
The surge follows disruptions in the Black Sea that strained grain exports from Russia and Ukraine. Russia and Ukraine together account for about 27% of global wheat production, according to S&P Global.
Ukraine's agricultural exports this season could come in at about half the level previously forecast, the country's Agriculture Ministry said. Ukraine normally sends about 90% of its grain exports through its Black Sea ports, but repeated attacks have forced exporters to rely more heavily on the Danube, rail and road routes.
Agriculture Minister Taras Vysotskyi has warned that August agricultural exports could fall to about 1.5 million metric tons if attacks on Ukrainian ports continue. That compares with more than 3 million metric tons exported in July, including 2.4 million tons through the Greater Odesa ports.
Before the latest wave of port attacks, Ukrainian agricultural exports generated about $2 billion a month, according to Vysotskyi. Under the weaker August scenario, he estimated export revenue could fall to roughly $1 billion.
Russia's wheat shipments in August are also expected to fall by more than 50% from the same period last year, further tightening supplies available to international buyers.
Along with wheat, corn futures also reached three-year highs as the rally spread across the broader grain market, with soaring Chinese demand adding to pressure from Black Sea tensions.
The most-traded Chicago corn contract rose to $5.37 a bushel on Thursday, its highest level since July 2023. Soybean futures climbed to around $12.50 a bushel, reaching their highest level since May 2024.
China's buying interest comes as extreme heat and heavy rainfall threaten agricultural regions across the country, raising concerns over crop quality and potentially increasing import demand. Corn, soybeans and cotton are among the crops facing weather pressure, with several major producing provinces affected since mid-July.
China imported 1.4 million tons of corn from January through July, up 61.3% from a year earlier, pointing to stronger demand from one of the world's biggest agricultural importers.
The U.S. Department of Agriculture also reported a private sale of 333,000 metric tons of U.S. soybeans to China for delivery in the 2026/27 marketing year on Aug. 26.
The deal adds to a series of soybean sales reported in August, including 136,000 metric tons on Aug. 18, another 136,000 metric tons on Aug. 14 and 125,000 metric tons on Aug. 13.
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