Shipping halt causes congestion at Russia’s Azov ports

Russia has temporarily stopped accepting applications for vessel transit through the Kerch Strait and suspended navigation along the Don-Azov Canal following Ukrainian drone attacks on Russian vessels in the Sea of Azov. Reuters reported this, citing sources in the shipping and grain industries. According to the agency, from 6:10 p.m. local time on July 10, Russian border guards stopped accepting new transit requests through the Kerch Strait, while no timeline has been announced for the resumption of traffic.

The restrictions were introduced after a large-scale Ukrainian drone attack on Russian vessels in the Sea of Azov. Although aerial drones do not always sink ships, they can inflict significant damage that puts vessels out of service for lengthy repairs. If such attacks continue, they could gradually reduce the number of operational ships and make crews increasingly reluctant to sail because of growing safety risks. Up to 25% of Russia’s wheat exports pass through the Sea of Azov, while the Rostov and Krasnodar regions are among the country’s key grain-producing areas, meaning disruptions to shipping could significantly affect export logistics.

Amid reports of possible disruptions to export routes, September wheat futures on Euronext rose by nearly 4% on July 10, reaching their highest level in six weeks. The market reacted to the risk of reduced Russian wheat supplies from one of the world’s largest wheat exporters.

Meanwhile, Russian Telegram channels and regional sources report that the ports of Azov, Rostov-on-Don and Taganrog have temporarily suspended grain intake following the restrictions. Reports have also emerged of long queues of grain trucks outside the ports, while fully loaded vessels are unable to leave for sea.

If the shipping restrictions remain in place for an extended period, they could put additional pressure on Russia’s grain exports during the peak of the new harvest campaign. At the same time, any disruption to grain shipments from the Sea of Azov region could support global wheat prices and increase volatility in the grain market.