Chicago wheat flat after Ukraine strike raises Black Sea export concerns
CANBERRA: Chicago wheat futures were largely flat on Thursday after a sharp rise in the previous session, when Ukraine attacked grain terminals at a major Russian port, raising concerns about disruption to Black Sea grain exports. Corn futures fell as the Rosario grain exchange raised its forecast for Argentina’s harvest to record-high levels, but prices maintained most of the gains made on…
Wheat futures on the Chicago Board of Trade (CBOT) remained relatively unchanged on Thursday following a significant increase the previous day. The sharp rise in wheat prices was triggered by Ukraine's missile attack on grain terminals in a major Russian port, sparking worries about potential disruptions to Black Sea grain exports.
In contrast, corn futures experienced a decline as the Rosario grain exchange raised its forecast for Argentina's harvest to record-high levels. However, prices retained most of the gains from the previous day following the US Department of Agriculture's (USDA) announcement that strong demand would reduce US inventories. Soybean prices remained largely unchanged.
The CBOT's most actively traded wheat contract saw a 0.2% decrease in value, settling at $6.51-1/4 per bushel by 0248 GMT, after surging by 3.6% earlier in the day. This price decline can be attributed to the ongoing conflict between Ukraine and Russia, which are among the world's leading wheat exporters. A Ukrainian strike on Russia's Novorossiysk port city led to temporary shutdowns of two major grain terminals on Wednesday, while Russia retaliated by attacking Ukraine's Izmail port area, causing damage and a fire.
The series of attacks has reduced shipping volumes from both nations, compelling them to seek alternative routes for their exports.
Analysts believe that if logistical export issues are addressed, global wheat prices could experience a notable decrease. Commonwealth Bank analyst Dennis Voznesenski noted that the combined harvest of Russia, Ukraine, and Romania is the third-largest on record. He suggested that once logistical export constraints are resolved, global wheat prices might weaken significantly.
In addition to wheat, other crops also showed varying price movements. CBOT corn declined by 0.6% to $4.77-3/4 per bushel after spiking 4.4% to a two-week high on Wednesday. Meanwhile, soybeans remained steady at $11.81-3/4 per bushel following a 1.2% increase the previous day. The USDA projected that US farmers would harvest their second-largest corn crop on record in the upcoming autumn, with lower yields partially offset by increased planting.
However, the USDA lowered its forecast for US corn stocks at the end of the season to 1.653 billion bushels from the previous estimate of 1.790 billion bushels.
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