Wheat prices rise after Russia attack on Danube grain port

Wheat prices rose again on Wednesday after Russia attacked a Ukrainian port on the Danube River, news agencies reported, having also on Monday opened fire on a Ukraine-bound cargo ship to force it to stop for inspection.

Futures in Chicago rose as much as 1.3 percent after tumbling 6 percent over the past three sessions, Bloomberg reported.

Russian overnight air strikes on southern Ukraine damaged grain silos and warehouses at a key facility for grains shipments, the governor of the Odesa region on the Black Sea said on Wednesday.

Russia attacked the Odesa region “twice last night” using “attack drones”, Governor Oleh Kiper said on the Telegram messaging app.

“The main target is port and grain infrastructure in the south of the region,” he said, without naming the port.

The presidential office said in a separate statement that there were no casualties. But Ukrainian officials have not yet said whether the attacked port is operational.

Ukrainian river channels have become increasingly important to circumvent Moscow’s blockade of transporting grain through the Black Sea. Earlier this month, Russian drones also targeted ports on the Danube River, including Izmail, according to Bloomberg.

The Danube ports accounted for around a quarter of grain exports before Russia pulled out of a UN-Turkey backed Black Sea Grain Initiative deal in July, as reported by Reuters.

Ukraine, earlier this week, announced the new Black Sea corridor is open for ships wishing to carry grains from Ukrainian ports, under Ukrainian protection.

Yesterday marked the launch of the first cargo ship using the new Black Sea shipping lanes, which was seen leaving the southern port of Odesa earlier today, according to Agence France-Presse (AFP).

Wheat prices are still around 20% lower this year following bumper harvests in parts of the Northern Hemisphere. The US Department of Agriculture on Friday raisedits estimate for Russian shipments in the 2023-24 season, and boosted its forecast for US wheat stocks by more than analysts had expected on average.

Tags: wheat, порт, Black Sea, grain silos, shipments, Danube River, Ukraine, Russia, exports, prices, Grains