Asian importers are buying expensive Australian wheat instead of Ukrainian wheat – Reuters
Asian importing countries have purchased at least 500,000 metric tons of wheat from Australia and Argentina in recent days to replace delayed or canceled shipments from the Black Sea region.
These urgent purchases were prompted by Russia’s attacks on civilian vessels and Ukrainian port infrastructure, including the damage caused on August 31 by a drone strike on the UEP grain terminal operated by the American company ADM in Odesa. Due to disruptions at the terminals and the risk of contract cancellations, buyers from Indonesia, Bangladesh, Vietnam, Malaysia, Thailand, and Sri Lanka are forced to pay up to $70 more per metric ton when purchasing alternative grain at a price of $310–$330, compared to $260–$280 for previously reserved Black Sea shipments.
The escalation of the situation in the Black Sea region and Moscow’s refusal to impose a moratorium on attacks have driven global wheat prices on the Chicago Board of Trade (CBOT) to their highest level in the past three and a half years, with futures having risen by approximately 35% since late June. Asian millers, who had previously ordered 2–2.5 million metric tons of Black Sea grain for shipment in July–September, are now meeting their immediate needs with more expensive shipments from South America and Australia, and are also partially switching to container shipping to ensure prompt production.
Source: Reuters.
Global wheat prices have risen by about 30% since June and have reached their highest level since July 2023. The market fears that the escalation of tensions between Russia and Ukraine in the Black and Azov Seas could disrupt the stability of the global food market.
The All-Ukrainian Agrarian Council (VAR) has appealed to Prime Minister Serhiy Koretsky, urging him to take immediate action to resolve the issue of blocked seaports. The association warns that a further deterioration of the situation could lead to mass bankruptcies of agricultural enterprises and a large-scale crisis in one of the key sectors of the Ukrainian economy.
