Global wheat buyers are facing higher costs as disruptions to grain shipments from Russia and Ukraine tighten supplies. Chicago wheat futures have climbed around 40% from their June lows to a three-and-a-half-year high, while attacks on vessels and port infrastructure have severely reduced Black Sea cargo movements.
Importers across Asia, the Middle East and Africa are increasingly looking to alternative suppliers such as Australia, Argentina and France. Indonesian millers, for example, are paying around 20%–25% more for Australian wheat than previous Black Sea purchases. October shipments of Australian wheat are being quoted at about $345 per tonne, compared with around $340 for Romanian Black Sea wheat.
Egypt, one of the world’s largest wheat importers, has also seen a sharp decline in shipments from Russia and Ukraine and is diversifying its purchases toward European suppliers. With some mills operating at reduced capacity and importers waiting for potential improvements in Black Sea shipping, competition for alternative supplies could remain strong until the Southern Hemisphere harvest arrives later in the year.
