Exporters of Ukrainian and Russian grain are likely to cancel contracts, invoking force majeure, market participants have said.
Some sellers have already been heard cancelling coaster loadings at Russian ports, and further cancellations are expected after Russia launched attacks across Ukraine. Ship movements have been halted in all of Ukraine's ports and market participants said ship movements had also been halted in some Azov Sea ports.
Suspended loadings, inaccessibility of ports and likely disruption to customs clearing could prompt many sellers to delay or cancel contract fulfilment by citing force majeure.
Ukraine still has some 7mn t of wheat and 14mn t of corn left to export this marketing year. And Russia's wheat export quota — in force from 15 February until the end of the marketing year — stands at 8mn t, most of which is yet to ship out.
Buyers could turn to alternative sources for grain, including France, Germany, the UK, Romania, Bulgaria, Argentina, Brazil, the US and Australia, market participants said.
