Wheat Prices in Chicago Reach Three-Year High

On the Chicago exchange, wheat prices have reached their highest level since July 2023 due to the threat of an escalation in hostilities in Ukraine. A potential escalation could halt exports from the Black Sea region, which accounts for over 25% of the global grain market. Prices surged by 6.4% in a single day, and since the beginning of the month, wheat has risen by 19% due to supply disruptions. The war has already damaged ports and terminals in Ukraine, limiting exports. Agricultural exports this season have fallen by more than half compared to preliminary estimates. Russian wheat supplies are expected to decrease by more than 50% year-on-year in August. Together, Russia and Ukraine account for over a quarter of global wheat exports. Due to risks in the Black Sea, countries in the Middle East, Africa, and Asia are forced to purchase more expensive grain from Argentina and Australia, which could lead to rising food prices worldwide. From August 1 to 18, Ukraine exported 899,600 tons of agricultural products, which is about 31% of its potential volume.

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