Ukraine’s strikes on Russian vessels in the Sea of Azov lifted wheat prices by 2% (updated)

Global wheat prices surged after a series of Ukrainian strikes on Russian vessels in the Sea of Azov. On Friday, CBOT wheat futures in Chicago climbed 2.14% to $6.33 per bushel, their highest level since late May. The September wheat contract on Euronext in Paris gained about 3%.

The rally was driven by reports of a large-scale operation by Ukraine’s Unmanned Systems Forces targeting Russian maritime logistics in the Sea of Azov. According to Defense Express, Ukrainian drones carried out 35 strikes on Russian vessels over 96 hours, involving 33 unique targets. The publication estimates that this represents about 27.5% of all vessels present in the Sea of Azov as of 7 July.

Traders fear that continued strikes on Russian vessels could disrupt maritime logistics in the Sea of Azov and create additional risks for Russian grain and cargo exports. These concerns became one of the main drivers of higher wheat prices, as Russia and Ukraine remain among the world’s largest wheat exporters.

Additional support came from expectations ahead of the latest USDA supply and demand report, which was expected to include updated estimates for U.S. crop acreage and grain stocks. Market participants anticipated a lower outlook for US wheat supplies, further supporting demand for wheat futures.

Meanwhile, corn and soybean markets remained relatively stable. CBOT corn futures gained just 0.39%, while soybean futures edged up 0.02%, as traders continued to assess weather conditions across the US Midwest and prospects for Chinese demand.

Updated. Unconfirmed rumours are circulating in the global grain market that Russia may temporarily restrict shipping through the Kerch Strait, the Sea of Azov and the Volga-Don Canal due to the security situation. There has been no official confirmation of these reports so far, but the rumours have already raised concerns among market participants.