Chicago | Reuters – U.S. wheat futures surged 8.6% on Monday, rising their daily maximum at the Chicago Board of Trade (CBOT) after Russia attacked Ukrainian ports and grain infrastructure, including the first attack on Danube River grain warehouses.
The attacks targeted a vital export route for Kyiv in an expanding air campaign that Moscow began last week after quitting the Black Sea grain deal.
Corn and soybeans followed wheat futures higher, with outlooks for hot weather this week in the U.S. crop belt adding support.
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CBOT September wheat WU3 settled up its 60-cent daily limit at $7.57-1/2 per bushel. As a result, CME Group CME.O, parent of the CBOT, said limits for its U.S. wheat futures would expand to 90 cents for Tuesday’s trading session.
Benchmark December corn CZ3 ended up 32 cents, or 6%, at $5.68-1/4 a bushel and November soybeans SX3 settled up 22-3/4 cents, or 1.6%, at $14.24-1/2 a bushel.
The attacks on Ukraine’s export routes sharpened traders’ focus on long-term threats to global grain supplies and food security.
“Russia continues to dump cheap wheat on the world market, and Brazil’s record harvest has the world well-supplied with corn near-term,” StoneX chief commodities economist Arlan Suderman wrote in a note to clients. “But the longer-term implications of destroying the export infrastructure of a major world exporter have bigger implications.”
Russia has been pounding Ukrainian food-exporting ports almost daily, with another attack on Sunday on Ukraine’s grain export port of Odesa.
Ukraine has hugely expanded grain exports overland via the EU since Russia’s invasion last year, with around 1 million tonnes a month exported. Major volumes have been exported from Romanian ports and along the Danube River.
In other news, the European Union’s crop monitoring service further reduced its crop yield forecasts for this year’s harvest, citing dry and hot weather.
After the CBOT close, the U.S. Department of Agriculture (USDA) rated 57% of the U.S. corn crop in good to excellent condition in its weekly crop progress report, steady with the previous week despite trade expectations for a slight improvement. The USDA’s weekly ratings for soybeans and spring wheat declined, while analysts on average had expected no change.
–Reporting for Reuters by Julie Ingwersen in Chicago. Additional reporting by Michael Hogan in Hamburg, Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.
