Black Sea Attacks Reignite Fears of Global Grain Market Turmoil

Recent attacks on cargo ships in the Black Sea are once again raising concerns about possible disruptions and their effect on global grain prices.

Ukraine has accused Russia of stepping up strikes on shipping in the region. President Volodymyr Zelenskyy described the actions as an attempt to reimpose a blockade on Ukrainian grain exports. The Black Sea remains a vital corridor, carrying roughly 70% of Ukraine’s grain shipments. Russia, for its part, claims Ukraine has increased attacks this month in the Sea of Azov, a route that handles about a quarter of Russian grain exports.

The Ukrainian Agri Council warned that if vessels stop calling at the greater Odesa ports, as much as 32.4 million tonnes of surplus grain could be left on the domestic market. That would drive prices below the cost of production. Shipowners are refusing to send vessels into the area because of direct threats to crews—risks that insurers are reluctant to cover.

The situation echoes 2022, when Russia’s blockade of the Black Sea sent grain prices soaring, especially in the Middle East and North Africa, regions heavily reliant on Ukrainian supplies.

Current tensions are already putting upward pressure on wheat and maize prices, according to food-geopolitics researcher Sébastien Abis. These pressures come on top of other maritime disruptions: Houthi attacks in the Red Sea and lower water levels in the Panama Canal caused by drought. Together they are stretching global shipping capacity. Longer voyages and waiting times increase demand for vessels and raise costs.

Arnaud Petit of the International Grains Council does not expect a repeat of the 2022 price shock in the medium term. This year’s harvest came earlier, and stocks in producing countries remain relatively comfortable. Abis notes, however, that many countries have already drawn down reserves, leaving little buffer between global production and consumption.

For farmers in eastern EU countries, the main worry is not higher prices but the opposite: another surge of Ukrainian grain flooding neighbouring markets and driving local prices down. In 2022 the EU’s “solidarity lanes” led to exactly that problem in Poland, Romania, Bulgaria, Hungary and Slovakia, sparking political friction.

Ukrainian exporters say they are better prepared this time. They have tested alternative routes, particularly the Danube, which carried almost 2.4 million tonnes of grain in the first eight months of 2023. Storage capacity has also been expanded and decentralised, making it harder to target and allowing grain to be held until the next harvest if needed. While alternative routes raise transport costs, the improved logistics and storage should help limit both domestic oversupply and tensions with neighbouring EU states.