Why Russia’s bombings of Ukrainian ports have jolted wheat prices
After three nights of Russian attacks, Ukraine’s ports are counting the cost. The latest bombing, which targeted the Black Sea hub of Odessa and nearby Mykolaiv early on July 20th, left at least two dead and more than 20 injured. Some 60,000 tonnes of grain have been burnt; piers and terminals have also been hit. Kernel, Ukraine’s largest producer of sunflower, said damage at its grain storage and handling infrastructure could take a year to fix.
For the rest of the world, a colder gauge also looks troubling. The price of wheat futures in Chicago, the global benchmark, has risen by 11% since the early hours of July 17th, when Russia said it would not renew a year-old deal allowing ships carrying Ukrainian food exports to cross the Black Sea. That seemed to have been priced in. Complaining that Western sanctions throttled its own food exports, Russia had been dragging its feet on letting vessels through for months; Ukraine’s grain shipments had fallen by nearly half between March and June. But the missile strikes appear to have jolted markets out of their torpor. Are they right to fret?
