Wars and El Niño tighten grain supply risks across Black Sea markets

Black Sea exports lose momentum

War-related disruption in the Black Sea is combining with pressure on Middle Eastern shipping and the threat of El Niño to raise risks for global grain supplies. Il Messaggero reports that analysts interviewed by CNBC see the three factors as capable of lifting global food inflation when considered together, even if none would necessarily have that effect alone.

Ukraine exported about 522,000 tonnes of grain during the first 18 days of August, equivalent to only 20% of its potential, according to Agriculture Minister Taras Vysotskyi. Average daily shipments fell to 29,000 tonnes from 91,000 tonnes in the same period a year earlier. Kyiv estimates that lost revenue could reach $10 billion during the season. The European Union could also face a corn deficit of as much as 5 million tonnes that Ukraine would normally have been capable of supplying.

President Volodymyr Zelenskyy said Ukraine was ready to negotiate a truce covering energy and agriculture but saw no equivalent willingness from Russia. He linked Russian attacks on the grain corridor to Ukrainian strikes against Russian oil facilities and the shadow fleet, leaving neither side prepared to move first.

Russian terminals and farm prices come under pressure

Russia is facing its own export bottleneck. According to Il Messaggero, attacks on Novorossiysk disabled terminals with annual capacity of 25 million tonnes, while 90% to 97% of export capacity in the Azov-Black Sea basin is currently blocked. Russia shipped about 900,000 tonnes of grain between August 1 and 17, compared with 4.4 million tonnes during August 2025. Russian analysts expect August 2026 wheat exports to be the lowest for that month since 2010.

The disruption is also depressing prices received by Russian farmers. Arkady Zlochevsky, president of the Russian Grain Union, said warehouses were filling as demand stalled. Domestic wheat prices have fallen from 15,000 to 12,000 rubles per tonne over a year. Russia is trying to redirect cargo through the Baltic, Caspian Sea and Far East, but those routes cannot replace the capacity lost in the south.

Costs rise as climate risk reaches crops

The blockage of the Strait of Hormuz and the conflict in the Middle East are pushing fertilizer prices higher. CoBank economist Jacqui Fatka described the increase as structural rather than temporary. Low water levels on the Danube and Rhine are adding pressure to river freight. If wheat production costs keep rising faster than farm selling prices, growers may reduce planting next year.

Climate conditions add a separate risk. A Rabobank study estimates that a strong El Niño could raise Brazilian fresh-food prices by as much as 20%, adding almost one percentage point to the official inflation index. In the United States, an excessively wet spring has already complicated the outlook for corn yields.

Prices rise, but the larger impact may be delayed

European soft wheat gained 8% in one month to $258 per tonne and reached peaks of $276. Chicago futures rose from $6.25 per bushel at the end of May to briefly exceed $7, although they remained below the May 2024 high and well short of the 2022 record.

The immediate inflation effect remains limited because Ukraine and Russia are still moving some cargo through the Danube, railways, the Baltic and the Caspian Sea. The market may not react sharply before September, when the global harvest is complete. If disruption continues through the end of the year, however, analysts cited by Il Messaggero expect tens of millions of tonnes could be unavailable, with the impact on logistics costs alone estimated at $16 billion. Italy faces a particular risk in pasta: domestic durum wheat is already priced below production costs, while processors dependent on imports could encounter a more expensive international market.