Wheat futures in the U.S. and Europe surged on Wednesday after Ukrainian drone strikes on Russian infrastructure shut down shipping routes through the Sea of Azov, threatening a key export corridor. U.S. wheat futures (W_1:COM) jumped 5.1% to $6.77 3/4 per bushel, while Paris wheat futures rose 6.9% to €231.50 per metric ton, according to LSEG data. The rally extended gains to 7% for the week.
Drone strikes disrupt Black Sea grain flows
Ukraine officials reported that drones had hit 116 Russian oil tankers and other vessels in the past nine days as of Tuesday, halting shipments through the Kerch Strait and the Sea of Azov. That waterway carries about 25% of Russia's annual wheat exports. Russia is the world's top wheat exporter, projected to ship 47.5 million metric tons in the 2026-27 marketing year, per USDA data. Ukraine, also a major exporter, is forecast to export 14.5 million tons this year.
Retaliation fears and supply concerns
"Retaliation is likely coming for Ukraine's grain export ports and routes, raising global concern over wheat supplies from the Black Sea region," said Matt Zeller of StoneX in a note. The conflict escalation adds to existing supply pressures: hotter-than-normal weather in June and July across the central U.S. and western Europe had already pushed prices higher. Last week, the USDA forecast the smallest U.S. wheat crop since 1970, damaged by extensive winter drought.
Corn and soybeans follow wheat higher
The wheat rally lifted other grains on the Chicago Board of Trade. Corn (C_1:COM) for December delivery settled up 1.9% at $4.69 1/4 per bushel, while soybeans (S_1:COM) for November delivery closed 0.9% higher at $12.01 3/4 per bushel. ETFs tracking the commodities, including the Teucrium Wheat Fund (WEAT), Teucrium Corn Fund (CORN), and Teucrium Soybean Fund (SOYB), also rose on the session.