Wheat Prices Climb on Russia Ukraine War Escalation Fears

Chicago wheat futures extended their upward trend for a third consecutive day after Russia issued threats to intensify its military campaign in Ukraine, raising concerns over further disruptions to global grain supplies from the Black Sea region.

The most-active wheat contract in Chicago surged by as much as 1.9% on Monday, marking the largest single-day gain in two weeks. This rally puts wheat on track for its longest winning streak in over a month.

Russia’s government announced plans to escalate strikes on Ukraine’s infrastructure following President Volodymyr Zelenskyy’s pledge to continue targeting oil refineries. On Saturday, Russian forces attacked a Liberian-flagged cargo ship at a port in Ukraine’s Odesa region, resulting in one fatality and three injuries, according to the Ukrainian Sea Ports Authority.

Supplies of wheat from the Black Sea region, a vital global breadbasket, have been restricted since July due to escalating attacks on shipping infrastructure and ports. Analysts at CRM AgriCommodities warned that ongoing hostilities could delay Turkey’s ceasefire efforts, with a potential deal taking “months” to materialize. The continued disruptions are seen as a key factor supporting higher wheat prices.

Meanwhile, the most-active European wheat contract in Paris climbed by as much as 1.9%, reaching its highest level in nearly three weeks. The contract built on last week’s gains, supported by Black Sea risks and a weaker euro, according to CM Navigator analysts.

As of 6:59 a.m. in Chicago, wheat prices in Chicago rose 1.5% to US$6.93 (RM28.29) per bushel. Paris wheat gained up to 1.4%, while corn and soybeans saw increases of 0.4% and 0.7%, respectively.