Black Sea conflict continues to drive up prices for wheat, corn, and sunflower

The protracted conflict in the Black Sea region, now in its sixth year, continues to exert significant pressure on global grain and oilseed markets. Ongoing Russian attacks targeting civilian infrastructure, including port facilities and companies involved in grain and oilseed trade, are disrupting crucial export routes.

Russia and Ukraine are dominant players in the global export of key Black Sea commodities. Together, they are the world's largest exporters of wheat and sunflower oil, and rank fourth in corn exports. These disruptions directly impact global supply, leading to sustained price increases for these essential goods.

In the sunflower oil market, both countries are leading exporters, with Russia shipping 5.2 million tons and Ukraine 4.4 million tons annually. Attacks on Ukraine's Kernel Holding, a major sunflower oil exporter, have hampered processing capacity and export volumes. This situation has created opportunities for Argentina, which has been able to increase its sunflower oil exports by guaranteeing regularity and fulfilling contracts, finding new markets.

Similarly, Russia and Ukraine collectively account for 29% of the global wheat trade, exporting a combined 62 million tons. Russia alone exports 47.5 million tons, while Ukraine exports 14.5 million tons. The conflict's impact on their wheat exports benefits other major exporters like the European Union, Canada, Australia, and the United States.

For corn, the global trade is dominated by the United States, Brazil, Argentina, and Ukraine. Ukraine, as the fourth-largest exporter with 23 million tons, plays a significant role. The combined exports of these four countries represent 80% of the total global corn trade. The Black Sea conflict, alongside other supply, demand, and climate factors, is a key reason for the firm prices observed in the wheat, corn, and sunflower markets, including within Argentina.