After a three-day rally, wheat prices stabilized on the CBOT

World wheat prices rose on a fresh wave of tensions in the Black Sea region. After a three-day rally, during which futures in Chicago rose by 1.7%, quotes stabilized near a weekly high amid growing risks to stable grain exports, Bloomberg reported.

The main factor in the growth was renewed concerns about disruptions in exports from the Black Sea region. The escalation of hostilities forced investors to once again build into the price a risk premium that had previously begun to disappear amid diplomatic hopes.

Thus, late on the evening of December 22, a hostile drone hit port facilities and a civilian ship in Odessa. The head of the OVA, Oleg Kiper, confirmed the destruction, and Deputy Prime Minister Oleksiy Kuleba specified that a shipment of soybeans intended for export was on board the ship.

Analysts note that the market is acutely sensitive to any threats to the logistics chains of the world’s two leading grain suppliers.

According to the Ukrainian Grain Association, constant attacks on critical infrastructure and electricity shortages do not allow railways and ports to operate at full capacity.

At the same time, the market is closely monitoring US peace initiatives. Special Envoy Steve Witkoff confirmed meetings with representatives of Ukraine and Europe to discuss an updated peace plan and a system of security guarantees.

Despite the intensification of the negotiation process, the real situation in the ports remains a decisive factor for prices.

Traders are weighing the potential for Ukraine’s economic development in the future against the current destruction that continues to limit the global food supply, writes Bloomberg.

Tags: prices, wheat