Wheat prices rose by 3-4.9% against the background of uncertainty with Ukrainian exports

The Ukrainian army continues a rapid counteroffensive, liberating Kharkiv Oblast, to which the Russian Federation responds by shelling civilian infrastructure. Yes, yesterday power plants and substations were damaged, which led to the disappearance of current in the eastern regions of Ukraine. Defeated on the front, Russia will try to disrupt the agreement on “grain corridors” to damage the Ukrainian economy.

On Friday, wheat futures on world exchanges rose in price by 3-4.9% due to uncertainty regarding the export of grain from Ukraine after November 1. Although according to the CFTC, traders reduced the number of wheat contracts as they do not expect prices to rise after the release of the USDA report and try to sell high ahead of possible problems with the grain corridors.

At the same time, the representative of the White House on national security, John Kirby, said that “the United States does not see signs of stopping the work of the grain corridors, which are now having the expected effect.”

On Friday, wheat quotations on world exchanges rose slightly after the previous drop:

• by 4.9% or $14.88/t to $319.5/t – December futures for soft winter SRW wheat in Chicago,
• by 4% or $13.3/t to $341.4/t – December HRW hard winter wheat futures in Kansas City,
• by 3.2% or $10.75/t to $340.8/t – December futures for HRS durum wheat in Minneapolis,
• by 1.1% or $3.5/t to $315.5/t – October Black Sea wheat futures in Chicago,
• by 3.8% or 12.5 €/t to 337.75 €/t or $340.67/t – December wheat futures on Paris Euronext.

The weather in Canada and the east of the Russian Federation favors the harvesting of spring wheat. In Canada, 40% of the crops were threshed, and in the Russian Federation, as of September 8, 92.7 million tons of wheat were harvested from 24.2 million hectares or 82% of the area with a yield of 3.83 tons/ha, while last year at this time 69 were threshed, 3 million tons with a yield of 2.92 tons/ha.

The market is interested in how much the USDA report will increase the wheat harvest forecast in the Russian Federation, which was estimated at 88 million tons in August. Experts from the Russian IKAR agency increased their production forecast by another 2 million tons to 97 million tons.

Since the beginning of grain corridors, as of September 9, 2.46 million tons of grain have been exported from the three Black Sea ports of Ukraine, and 237 ships have been allowed to move – 129 entering and 108 leaving the ports.

The pace of exports is below expectations, as shipowners take into account high risks when calling at Black Sea ports, which lowers the purchase prices for grain in Ukraine.

During the week, abundant precipitation in the Black Sea countries, in particular Ukraine, will replenish moisture reserves on the eve of sowing, although the sowing area will be reduced due to hostilities in the south and east of the country.

Tags: Ukraine, Russia, prices, Canada, wheat, USA